Food & Drug Law Blog

FDA Marketing: PAR v US – “Pay no attention to the man behind the curtain” - Why is the Government Trying to Strike its Own Statements from the Public Record?

Michael A. Walsh — Wed, 20 Mar 2013 00:00:00 -0500

On March 5, 2013 the Department of Justice issued a Press release announcing “Par Pharmaceuticals Pleads Guilty and Agrees to Pay $45 Million to Resolve Civil and Criminal Allegations Related to Off-Label Marketing.” The plea and agreement to a 5 year Corporate Integrity Agreement resolved criminal and civil liability for promotion of a prescription drug approved for weight loss in AIDS patients but “marketed” for the unapproved use of geriatric wasting. But now the government is seeking to strike from the public record how it “defined” off-label promotion in its communications with PAR.

The Settlement also resolved the action PAR v. US (PAR’s Action), an action filed by PAR seeking declaratory relief prohibiting “FDA’s unconstitutional and invalid regulations” restricting truthful non-misleading speech. Par Pharm., Inc. v. U.S. No. 11-cv-01820-RC, (D.D.C. filed October 14, 2011), ECF No. 1. More than a year ago, the government sought to dismiss the PAR Action and submitted a declaration of Dr. Rachel Sherman, Associate Director of Medical Policy and Director of the Office of Medical Policy (OMP) at the Center for Drug Evaluation and Research (CDER) at FDA. In the Declaration, the FDA purports to “describe ... FDA’s procedures and policies with respect to the communication of promotional information about off-label uses.” Id., ECF No. 14, p. 1. “Describing” its procedures and policies, FDA suggests that compliance with the law can be evidence of illegal conduct stating:

FDA does not consider a manufacturer’s truthful and non-misleading speech to healthcare professionals concerning the approved use of an FDA-approved drug as establishing, by itself, a manufacturer’s objective intent that the drug be used for an unapproved use.

Nor does FDA regard a manufacturer’s knowledge that an FDA-approved drug was being prescribed by healthcare professionals for an unapproved use as establishing, by itself, a manufacturer’s objective intent that the drug be used for an unapproved use. Id., ECF No. 14, p. 7.

While purporting to “describe its procedures and policies,” FDA provided no information explaining what evidence will suffice to render “truthful speech” or knowledge of facts illegal stating: “determining …the manufacturer’s ‘objective intent,’… can be based on … the circumstances surrounding the drug’s distribution … and may include “additional evidence suggesting …a deliberate strategy to encourage off-label prescribing.” Id., ECF No. 14, p. 8.

Not surprisingly, PAR filed a motion seeking to depose the FDA on the statements in the Declaration, stating:

These statements which cannot be found in any FDA regulation or other official agency issuance raise more questions than they answer. The Government tellingly does not explain how a company could ever engage in speech consistent with Dr. Sherman’s ‘by itself,’; i.e. without some ‘additional evidence’ that the government has left open....” Id. at 1:11-cv-01820, Doc 23 at pg. 1-2.

The Government’s Impenetrable Cloak of Transparency

In its motion to depose the FDA, PAR went on to detail conversations with DOJ that shed significant light on how the government defines “off-label” promotion, revealing startling facts in how the government prosecutes an off-label promotion case:

The Government has conveyed to Par positions inconsistent with Dr. Sherman’s assurances time and again in meetings throughout 2010 and 2011 between one or more of undersigned counsel and Government agencies... For example:

At meetings on April 29, 2010 and July 28, 2010, attorneys with the New Jersey U.S. Attorney’s Office and FDA questioned Par about promotion of Megace® ES in oncology and long-term care settings. The discussion focused on questions such as how Par could legally promote the use of Megace® ES for AIDS in those settings without first verifying the number of AIDS patients there.
In a telephone conference on September 2, 2010, prosecutors with the New Jersey U.S. Attorney’s Office acknowledged that certain Par marketing materials related to the on-label use of Megace® ES, but said that fact did not absolve Par of wrongdoing if the communications went to physicians who had prescribed Megace® ES for off-label uses.
During a meeting on June 21, 2011, officials with the U.S. Attorney’s Office, FDA, and DOJ Civil Fraud Section repeatedly suggested that the legality of promotional speech about Megace® ES turned on the number of AIDS patients the doctor treated. A senior DOJ official also indicated that promotion consisting of on-label speech that takes place in a setting where off-label use occurs is not protected by the First Amendment and, if Par believed otherwise, the issue would need to be litigated. The senior DOJ official further indicated that the Government’s view regarding the constitutionality of its position would not change unless and until a court told them otherwise.
At a meeting on September 20, 2011, officials from DOJ Civil Fraud, in the presence of HHS OIG and U.S. Attorney’s Office representatives who did not dissent, characterized the presence of Par sales representatives in long-term care facilities as inherently constituting off-label promotion regardless of whether the content of the speech related to on-label or off-label uses.

See PAR Pharmaceutical, Inc. v. US, 1:11-cv-01820 Doc 23 filed 3-23-12, Plaintiff’s Reply Memorandum in Support of Motion for Limited Discovery at pages 10-11.

Closing the Lid on Pandora’s Box

What the DOJ did not mention in its Press Release announcing its settlement with PAR is that it is seeking to have the court strike from the record the statements referenced in PAR’s motion for a deposition. The DOJ’s request is not based on a claim by the DOJ that the statements referenced by PAR are not accurate or not truthful, but rather, that the DOJ wanted to keep its approach to criminalizing potentially protected speech secret.

Over the past 10 years the government’s overwhelming enforcement power and unfettered discretion to define, criminalize and prosecute conduct it deems violative of the FDCA has produced rare instances where it has been required to define the conduct it deems criminal. PAR is among those rare instances where the government was forced to speak and the Government spoke in tongues. But where PAR documented comments by the government in its motion seeking to depose the FDA, the government seeks to strike its statements from the record.

There are precious few opportunities for courts to hear and decide the Due Process and First Amendment issues raised in cases such as the PAR Action. The Par Action was one of only three recent cases (Par, Caronia and Harkonen) with a chance of advancing the constitutional issues to the Supreme Court but the settlement of PAR, the government not appealing its loss in US v Caronia, leaves only US v Harkonen as the slim chance that these issues will get to the Supreme Court anytime soon.

Why is the government trying to strike its own statements from the public record? Because its statements demonstrate the regime for prosecuting off-label promotion runs afoul of Due Process and First Amendment protections. For now and the foreseeable future, in off-label enforcement proceedings and prosecutions, when the government says jump, industry will continue to say, how high?

Off-Label March Madness: One Loss, One Win and One Tie (Caronia, Harkonen and PAR)

Michael A. Walsh — Tue, 12 Mar 2013 00:00:00 -0500

In March 2013 the government had a chance to appeal its landmark loss in the Second Circuit in US v Caronia, the Ninth Circuit affirmed the conviction in US v. Harkonen, discussed below, and it settled two cases involving PAR Pharmaceuticals, one for off-label promotion and PAR’s action seeking to dismantle FDA regulation of marketing for approved products.

On March 4, 2013 the Ninth Circuit affirmed the conviction and sentence of the physician/CEO Dr. Harkonen who was convicted of wire fraud in connection with the off-label marketing of Actimmune, a product approved by the FDA for rare pediatric diseases. Perhaps it didn’t help Dr. Harkonen that the company’s “former Senior Director of Biostatistics testified that post-hoc analyses are ‘good science’ in the sense that they may generate hypotheses for future study, but that he ‘winced’ when he saw the Press Release because ‘the conclusiveness of the results was overstated.’” US v Harkonen, 2013 U.S. App. LEXIS 4472 2013 *12 (9th Cir. Mar. 3, 2013).

At trial, Harkonen received 3 years’ probation, six months’ home detention, community service and a $20,000 fine. On appeal, the US sought a greater sentence and Harkonen sought to reverse the verdict. In denying Harkonen’s motion to exclude protected speech at trial, the trial court stated:

‘[T]he First Amendment does not shield fraud.’ Contrary to the government's allegation, however, this does not mean that a prosecution for fraudulent misbranding ‘cannot present First Amendment concerns.’ The court must do more than accept the government's legal conclusions and must test the indictment by its sufficiency to charge an offense.

US v Harkonen 2009 U.S. Dist. LEXIS 47255 (N.D. Cal. 2009) (internal citations omitted). The trial Court decided the case prior to the Second Circuit ruling in Caronia, which held that “the government cannot prosecute pharmaceutical manufacturers and their representatives under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug.” While the Ninth Circuit affirmed Harkonen’s conviction 90 days after the Second Circuit decided Caronia, it did not once mention the Second Circuit opinion.

The trial court in Harkonen did comment on Caronia stating that unlike Caronia where the Government called speech evidence, Harkonen concerned both speech and conduct (i.e. the dissemination of speech):

The government is not trying to get protected speech in through back-door means by asserting the statements at issue are merely ‘evidence’ of a crime Harkonen committed. Rather, the government contends the fraud charges turn on a series of communications, stemming from the press release and continuing with deceptive disseminations to doctors and to patients, all of which together constituted a scheme to defraud. These allegations involve both the content of speech (the press release and copies and excerpts thereof in writings) and conduct (dissemination of those items). Thus, Harkonen is wrong when he claims that ‘no conduct extrinsic to the speech is being prosecuted’ because the government stated a conviction could be based upon both the press release and its disseminations. The court refers to both ‘speech’ and ‘conduct’ where appropriate in this Order.

The Court went on to wallow in a quagmire of “bona fide,” “pure” and “less pure” speech stating:

With the case law still in an unsettled state, see, e.g., United States v. Caputo, 517 F.3d 935,
939 (7th Cir. 2008); Caronia, 576 F. Supp. 2d at 394, this would present a thorny issue for the court were it not for the fact that the allegations of the indictment do not trench anywhere near the outer bounds of speech deemed controversial. As best can be gleaned from the case law and from the government's position in prior cases and in this case, speech is protected by the First Amendment if it is a bona fide scientific and educational speech that appears in independent and peer-reviewed sources, such as a journal article reprint or a medical textbook. While questions remain about when such "pure" speech gets converted to a "less pure" form of commercial speech when a drug company is involved, e.g., by funding the studies or by disseminating the speech through various promotional activities, they are of no moment here because nowhere does the indictment invoke any "pure" scientific speech.

The mere fact that Harkonen is an M.D., that the press release he prepared presented actual data and statistical analyses, and that the dissemination of the press release may have generated vigorous debate in the pulmonological and pharmaceutical analyst community, do not disturb this conclusion. That the speech is a press release and not a peer-reviewed publication, that it refers to a specific commercial product on the market (Actimmune(R)), and that it was unquestionably disseminated for commercial benefit (e.g., the first line notes InterMune's Nasdaq stock symbol), are allegations that take the speech at issue outside the realm of pure science speech and move it towards the realm of commercial speech.

What the indictment alleges, and what the law does not protect as a First Amendment carve-out to liability under the FDCA, is that the press release and associated speech incorporates, reformats and post hoc reinterprets scientific results in a false and misleading manner and is then disseminated at Harkonen's direction to physicians and patients. As the government affirms, ‘the [d]efendant is under indictment not because he promoted Actimmune[(R)] for an unapproved use . . . but because he made knowingly false and misleading statements in doing so.’

Id. at 17-20. In essence, concluding what the government commonly claims that false speech is not entitled to First Amendment protections. In discussing the alleged fraudulent nature of the Government’s claims, the trial Court observed that the data that Harkonen was indicted for promoting had already been submitted to and rejected by the FDA:

This was not a mere statement by an FDA employee that did not represent the views of the FDA but rather, as alleged, it constituted the underlying basis for the FDA's refusal to approve Actimmune(R) to treat IPF. Harkonen's argument that the FDA may not establish scientific truth vel non is misplaced. The allegation goes to the non-approved status of Actimmune(R) in treating IPF and the fraudulent representations made in the press release and its disseminations in spite of this non-approved status.

In its unpublished opinion, the Ninth Circuit reviewed the First Amendment challenges “in two steps: (1)…whether sufficient evidence supports the verdict; and (2) …whether the facts…establish the core constitutional facts.” US v Harkonen, 2013 U.S. App. LEXIS 4472 2013 *5 (9th Cir. Mar. 3, 2013). The “core constitutional fact” for Harkonen was a fraud finding by the jury, which the Ninth Circuit found supported by sufficient evidence. In a footnote, the Ninth Circuit noted that Harkonen presented evidence “that most firmly supported his case” but the Ninth Circuit Court did not consider the evidence because it had not been presented to the jury.

The Ninth Circuit opinion sidesteps any in depth analysis of the First Amendment or Due Process issues raised by Harkonen on this appeal. In addressing the government’s request to enhance the sentence, the Ninth Circuit observed that the government failed to “articulate a loss theory that made sense.” Citing the trial court, the Ninth Circuit noted that the government failed to prove an “actual pecuniary loss” by a “vulnerable victim” and “[t]his is clear from the district court’s conclusion that ‘we can’t even figure out who is a victim in this case, and whether the victims were benefited in some way.’” Id. at *13.

Harkonen and Caronia were released within 90 days by two Circuit Courts, both addressing off-label issues in the context of the FDCA, the First Amendment and Due Process. Interestingly, the Court’s reached very different results related to the Constitutional issues concerning how the government regulates and prosecutes the dissemination of off-label information. These opinions, and the disparity between them, may, at long last, bring off-label “promotion” one step closer to being heard by the Supreme Court.

Fines, Detentions and Arrests

Michael A. Walsh — Fri, 22 Feb 2013 00:00:00 -0500

Fines
Detentions and
Arrests

The New Normal for the Food Industry - Compliance Programs and Employees Who (Seriously) Enforce them.

The Company: Peanut Corporation of America (PCA). The Crime: not complying with good manufacturing practices resulting in a potentially deadly outbreak of food borne illness. The Punishment: PCA is out of business, and on February 20, 2013 the Department of Justice unsealed a 76 count criminal indictment of former executives and employees. See Indictment, available here.

The indictment relates to a national outbreak of salmonella in 2008 and 2009 that was traced to PCA “as a likely source for that outbreak.”

As charged in the indictment, PCA produced peanuts … under insanitary conditions, which included PCA’s failure to follow appropriate practices to ensure its plants were sanitary, its failure to prevent cross-contamination between raw and cooked product, and its failure to take adequate steps to keep rodents and insects out of the plant.

See the Department of Justice Press release, Feb. 21, 2013, available here.

The Indictment charges that the employees committed fraud and conspiracy by falsifying data concerning the “quality and purity of the peanut products and specifically misled PCA customers about the existence of foodborne pathogens…” The indictment charges that test results were ignored and the company falsified documents that attested to quality “stating that shipments of peanut products were free of pathogens when, in fact, there had been no tests on the products at all or when the laboratory results showed that a sample tested positive for salmonella.”

Compounding the criminal problems, once the investigation began “[defendants] gave untrue or misleading answers to questions” concerning “the plant, its operations, and its history.” The charges range from conspiracy to introduce adulterated food into interstate commerce and misbranding with the intent to defraud, to wire fraud and obstruction of justice. One of the defendants has already pled guilty.

Announcing the indictment, the Deputy Assistant Attorney stated that:

Under the FDCA, it is illegal to introduce into our markets a food or drug that is adulterated – which, for foods, generally can mean either that the product is tainted or that it was produced or handled in insanitary conditions. As a result, the FDCA is a powerful tool for protecting the health and safety of all Americans. Using the FDCA, the Department has worked to prevent adulterated products from reaching consumers by securing injunctions that ban companies from distributing food or drugs until they have cleaned up their facilities. And, when adulterated products do reach the market and pose a significant danger to the public, we will not hesitate to bring criminal cases that seek to hold wrongdoers accountable and deter other would-be violators.

See Statement of Principal Deputy Assistant Attorney General Stuart F. Delery, February 21, 2013, available here.

Beginning in 1906, when faced with information concerning widespread unsanitary food handling, Congress established the Food and Drug Administration and set its mission to promote the public health and to ensure that “foods are safe, wholesome, sanitary and properly labeled.” 21 U.S.C. § 393. Since that time, outbreaks of foodborne illness have resulted in Congress increasing the grant of federal oversight of the food industry providing the FDA more and greater powers to regulate and punish food manufacturers for violations of the Food Drug and Cosmetic Act (FDCA) and FDA’s Regulations. Most recently and perhaps most profoundly, the Food Safety Modernization Act of 2010 (FSMA) signed into law on January 4, 2011 gave the FDA significant new muscle and, since its enactment, FDA has flexed its substantial new regulatory might through fines, product detention, suspension of registration and criminal prosecution of executives and employees.

Section 402 FSMA granted the FDA “expanded authority” to detain and seize any regulated food determined to be unsafe, adulterated or misbranded, “or otherwise failing to meet the requirements of the food safety law.” In addition to FDA’s new seizure and detention powers, FSMA added significant civil penalties (i.e. “not more than $1,000,000 for each offense and every day is considered a separate offense) and expands on the criminal sanctions under the FDCA.

Under prior law, the penalty was up to 1 year in prison. Now, if the offense results in serious illness, “the person committing the violation shall be imprisoned for not more than 5 years” and 10 years if it results in death. Couple these sanctions with the government’s use of the Park Doctrine in prosecuting “C” suite officers, even when they had no actual knowledge of an offense, and there should be no question that ensuring compliance can no longer wait until an inspector knocks at the door. In the past, adverse health outcomes were strong drivers for enforcement and criminal prosecutions, but the new powers granted under FSMA has resulted in a demonstrable willingness to use the new authority granted under FSMA without waiting for an adverse health outcome:

When food or drug manufacturers lie and cut corners, they put all of us at risk. The Department of Justice will not hesitate to pursue any person whose criminal conduct risks the safety of Americans who have done nothing more than eat a peanut butter and jelly sandwich.

See id.

As FDA continues its march to implement FSMA, including its proposed Rule concerning Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Human Food there are three things manufacturers and distributors must do: Comply, Comply, Comply. Having a written Comprehensive Plan that includes responding to FDA inspections is an essential first step. A robust response with a comprehensive corrective action plan demonstrating the ability to immediately implement corrective measures might be the one thing that prevents fines, product detentions, suspension of registrations and criminal prosecution of executives and employees.

Food Labeling – FTC Fumbles the First Amendment

Michael A. Walsh — Fri, 25 Jan 2013 00:00:00 -0500

FTC deftly ignores the most interesting and important aspect of the POM Wonderful case.

On January 10, 2013 the Federal Trade Commission issued its Opinion, a long awaited next-step in the arduous journey of In the Matter of POM Wonderful LLC et al to the United States Supreme Court that is provided that POM has enough fight left to continue this battle.

This is a significant First Amendment case buried and obscured within a quagmire of administrative second guessing. The FTC addresses the Constitutional First Amendment issues while applying a poorly reasoned rubber stamp to the government’s disdain for the First Amendment.

The government historically “wins” battles involving the First Amendment and FDA regulated industry, most notably settlements involving criminal prosecutions concerning off-label promotion. The government prevails not necessarily because of the merits but because it applies unlimited resources coupled with devastating civil and criminal penalties crushing the few who can afford to fight but cannot afford to lose and fewer who can afford to lose but cannot afford to fight. POM is different for a number of reasons. For one, the case raises serious First Amendment issues without the looming specter of criminal charges or civil penalties.

In an Initial Decision issued on May 17, 2012, a Federal Trade Commission Administrative Law Judge found that some of POM Wonderful’s claims implied that its products treat disease and those claims were not supported by sufficient scientific evidence, rendering the claims “false and misleading” under the Federal Trade Commission Act (“FTC Act”) (15 U.S.C. § 41 et seq.). The ALJ entered a multi year cease and desist order against POM Wonderful, but the ruling was not the victory the FTC sought. Instead, it sought prior review of marketing materials and a requirement for a heightened level of scientific research. The FTC dropped this issue before the Commission.

Since the enactment of the Dietary Supplement Health Safety Act in 1994, manufacturers making health related claims on food products have resided in an uncomfortable regulatory world between foods, which is how they are regulated, and drugs, which is how they are prosecuted. The ALJ recognized that “individuals could benefit from truthful claims about a product’s ability to treat, prevent, or reduce the risk of diseases or medical conditions...” In re POM Wonderful LLC, No. 9344, 2012 FTC LEXIS 106, at *558 (May 17, 2012). However, whether product claims “cross the line” remains a fact intensive inquiry where health claims that products “treat disease” that are not “supported by sufficient scientific evidence” are “false and misleading” under the FTC Act.

The POM litigation began in September of 2010 when POM filed a declaratory judgment action in the District Court for the District of Columbia (10-cv-1539). POM claimed, among other things, that FTC had adopted a “new standard” (as evidenced in the Nestle Consent Order and and Iovate Stipulated Final Judgment which required prior review of product claims), without formal rulemaking requiring companies to obtain pre-approval of advertisements by FDA and two controlled clinical trials to substantiate health claims. According to POM, the “new standard” violated the First Amendment as a prior restraint prohibiting POM from disseminating truthful scientific information. FTC commenced its administrative proceeding shortly thereafter and sought to dismiss the federal court case on the grounds that its administrative proceeding rendered POM’s federal court action moot because FTC was not enforcing a “new standard” but “merely” requiring “prior review” as a remedy. The FTC trial took more than 5 months, included 2,000 exhibits, 46 company sponsored studies (costing over $35 million dollars), 14 testifying experts, 10 additional witnesses, over 3,000 pages of trial transcript, 4,000 findings of fact, and 4,000 pages of post trial briefing—resulting in an initial decision of 335 pages.

In its Opinion, the Commission did not reach the question of the number of randomized controlled clinical trials (RCTs) needed to substantiate “claims” because it decided the case narrowly, on the facts and case before it finding POM “failed to proffer even one RCT that supports the challenged claims that we found they made.” The Final Order issued by the Commission differed and contains “fencing-in relief by providing that any disease-related establishment or efficacy claims made about the Challenged POM Products or in connection with Respondents’ sale of any food, drug, or dietary supplement must be supported by at least two RCTs.”

For manufacturers, this ruling provides little clarity concerning the level of substantiation needed to support claims but strongly suggests that “RCTs” are “required.” In this regard, the Commission held:

Respondents argue that they should not be required to meet “an impossibly high and legally untenable standard of dispositive proof through the clinical studies” that their products treat, prevent or reduce the risk of disease in order to provide substantiation for their claims. We reject Respondents’ argument.

We need not determine the level of substantiation required to support all health claims, and we therefore decline to make such a finding … we do not reach the issue regarding the level of substantiation for other unspecified health claims involving food products. We simply reject the ALJ’s findings and conclusions regarding any health benefits not specifically challenged in the Complaint.… Again, we address only the level of substantiation needed to support the claims that are at issue in this case and do not address hypothetical claims.… The Commission finds that experts in the relevant fields would require RCTs (i.e., properly randomized and controlled human clinical trials described in more detail below) to establish a causal relationship between a food and the treatment, prevention, or reduction of risk of the serious diseases at issue in this case.

While the Commission did not undertake a serious First Amendment analysis or consider the Supreme Court’s Central Hudson factors, it did stumble on the issue of whether the government’s objectives could have been met through less restrictive means with disclaimers. The Commission, nonetheless, rejected disclaimers as preferable to banning speech altogether:

Our analysis here is consistent with the Commission’s experience in other situations where it has found the use of qualifiers to be inadequate to sufficiently modify an otherwise false or misleading claim to render it non-deceptive. See, e.g., Guides Concerning Use of Endorsements and Testimonials in Advertising, 16 C.F.R. § 255.2 (ads with endorsements will likely be interpreted as conveying that the endorser’s experience is representative of what consumers will generally achieve, even when they include disclaimers such as “Results not typical” and “These testimonials are based on the experiences of a few people and you are not likely to have similar results”); FTC Staff Report, Effects of Bristol Windows Advertisement with an “Up To” Savings Claim on Consumer Take-Away and Beliefs (May 2012), available here, (when marketers use the phrase “up to” in their ads, such as making a claim that consumers will save “up to 47%” in energy costs by purchasing replacement windows, the qualifier does not affect consumers’ overall takeaway that the percentage savings depicted is typical of what they can expect to achieve).

Like the ruling below, the Commission painstakingly pored over the massive volume of evidence but when it came to the core Constitutional First Amendment issue, the Commission punted using the rule of ipse dixit wherein it declared POM’s claims false thus rendering the First Amendment inapplicable. Buried at the end of the Opinion is the Commission’s First Amendment “analysis”:

Once the Commission has determined that Respondents’ ads are actually misleading, no further analysis is necessary because misleading commercial speech is not protected by the First Amendment. Each of the cases cited by Respondents acknowledges that ‘[t]he Federal Government [is] free to prevent the dissemination of commercial speech that is false, deceptive, or misleading.” Zauderer, 471 U.S. at 638. The three-part analysis for determining whether regulation of commercial speech is constitutional under Central Hudson – whether the regulation is based on a substantial governmental interest, whether the regulation directly advances the governmental interest asserted, and whether the regulation is not more extensive than necessary to serve that interest – is applicable only if a threshold inquiry determines that the speech in question is not false or misleading. See Cent. Hudson Gas & Elec. Corp., 447 U.S. at 566; Edenfield v. Fane, 507 U.S. 761, 768 (1993); Daniel Chapter One, 2009 WL 5160000 at *19-20.

The Commission was content to side-step any serious discussion of the First Amendment, failing to recognize that the “threshold inquiry” is not whether its pronouncement of “falsity” dispenses with the First Amendment but whether the speech at issue constitutes “commercial speech.” The Commission simply assumed it was commercial speech, declared it false and, conveniently, declared the First Amendment inapplicable. Notably missing from the Opinion was any recognition that the Supreme Court recently stated that it “has never endorsed the categorical rule the Government advances: that false statements receive no First Amendment protection.” US v Alvarez, 132 S.Ct. 2537 (2012)

Even courts, including the Supreme Court, that find that heightened scrutiny applies will undertake a step-by-step analysis of each of the Central Hudson factors. Ensuring the protections granted in the Constitution are important to most courts but proved inconvenient to the FTC as it rubber-stamped the government’s disdain for the First Amendment.

Drugs are not Lawnmowers

Michael A. Walsh — Tue, 15 Jan 2013 00:00:00 -0500

“Drugs are not lawnmowers” says the Alabama Supreme Court as it mows down the law of medical products liability.

In the wake of the US Supreme Court finding failure to warn claims against generic manufacturers preempted in PLIVA v Mensing, 131 S. Ct. 2567 (2011), the Alabama Supreme Court in Wyeth v Weeks 1:10-cv-602 struggled to find a cause of action for injured Plaintiffs.

In Mensing v Pliva the United States Supreme Court noted that the confusion over claims against generic manufacturers emanates from the United States Congress creating a bizarre statutory scheme:

"But 'it is not this Court's task to decide whether the statutory scheme established by Congress is unusual or even bizarre." It is beyond dispute that the federal statutes and regulations that apply to brand-name drug manufacturers are meaningfully different than those that apply to generic drug manufacturers. Indeed, it is the special, and different, regulation of generic drugs that allowed the generic drug market to expand, bringing more drugs more quickly and cheaply to the public. But different federal statutes and regulations may, as here, lead to different preemption results. We will not distort the Supremacy Clause in order to create similar preemption across a dissimilar statutory scheme. As always, Congress and the FDA retain the authority to change the law and regulations if they so desire."

Rather than throwing up its hands pointing to the mess Congress made decades ago of the statutory scheme, a mess Congress continues to ignore, the Alabama Supreme Court tried to work its way through the thicket and created a new approach to extend liability to a manufacturer whose label was “relied upon” in connection with the ingestion of another company’s product.

In Weeks, Plaintiffs ingested a generic manufacturer’s product but argued that the brand manufacturer owed a duty to his physician as the learned-intermediary. The Alabama court agreed stating:

Plaintiffs are entitled to rely on the representations made to their physician. Because a warning label is not a part of the manufacturing process, we do not agree that the fact that a brand-name manufacturer did not produce the version of the drug ingested by the plaintiff bars the plaintiff's tort action when the plaintiff is arguing that he or she was injured by a failure to warn.

Therefore, an omission or defect in the labeling for the brand-name drug would necessarily be repeated in the generic labeling, foreseeably causing harm to a patient who ingested the generic product.

The Court concluded that the brand manufacturer “owed a duty to the Weekses as third parties to the alleged fraud in failing to adequately warn of the risks of Reglan in its labeling” and the “physical harm suffered by a consumer of prescription medication would have been reasonably contemplated by a manufacturer who made fraudulent statements on the warning label related to that medication.”

According to the Court “prescription medication is unlike other consumer products. Unlike "construction machinery," "lawnmowers," or "perfume," which are "used to make life easier or to provide pleasure," a prescription drug "may be necessary to alleviate pain and suffering or to sustain life." Having established that drugs are not lawnmowers, the Court reasoned:

In the context of inadequate warnings by the brand-name manufacturer placed on a prescription drug manufactured by a generic-drug manufacturer, it is not fundamentally unfair to hold the brand-name manufacturer liable for warnings on a product it did not produce because the manufacturing process is irrelevant to misrepresentation theories based, not on manufacturing defects in the product itself, but on information and warning deficiencies, when those alleged misrepresentations were drafted by the brand-name manufacturer and merely repeated by the generic manufacturer.

The Alabama Supreme Court further noted that the tort system is well suited to do the work that FDA is unable to do:

the United States Supreme Court in Wyeth v. Levine recognized that Congress did not preempt common-law tort suits, and it appears that the FDA traditionally regarded state law as a complementary form of drug regulation: The FDA has limited resources to monitor the 11,000 drugs on the market, and manufacturers have superior access to information about their drugs, especially in the postmarketing phase as new risks emerge; state-law tort suits uncover unknown drug hazards and provide incentives for drug manufacturers to disclose safety risks promptly and serve a distinct compensatory function that may motivate injured persons to come forward with information. Wyeth v. Levine, 555 U.S. at 578-79.

As the “bizarre” statutory scheme concerning generic drugs continues to baffle courts, new and even more “unusual and bizarre” remedies continue to emerge. Thankfully, the Alabama Court left for another day whether lawnmowers are medical devices.

And, thanks to the ever vigilant BEXIS Law Blog, the world remains informed: http://druganddevicelaw.blogspot.com/2013/01/have-you-ever-had-one-of-those-weeks.html

The Tort of Off-Label Promotion: US v Caronia - Just in Time for the Holidays, a Gift You May Not be Able to Return

Mike Walsh — Wed, 02 Jan 2013 00:00:00 -0500

December 3, 2012, was a good day for Alfred Caronia, a sales representative for a drug manufacturer. It was three years to the day after his trial for off-label promotion resulted in a conviction for a misdemeanor and subjected him to a $25 fine and 100 hours of community service. Not happy was one of his co-defendants, Dr. Gleason, who settled before trial and, as a result of his federal criminal plea, spiraled downward, taking his own life. So why is this sad little case ripping the fabric of FDA enforcement of off-label promotion, and might it have impact on the emerging tort of off-label promotion?

Not unlike the iceberg that sank the Titanic or the stone that felled Goliath, seemingly small things sometimes present surprising outcomes. And by all accounts, Mr. Caronia’s misdemeanor prosecution should have been a small thing. But, on December 3, 2012, two years to the day from hearing the case, the Second Circuit, in United States v. Caronia, ruled that the FDA’s civil and criminal enforcement of drug companies violates the First Amendment, stating:

“We conclude simply that the government cannot prosecute pharmaceutical manufacturers and their representatives under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug.”

2012 U.S. App. LEXIS 24831, *8 (December 3, 2012). The Second Circuit Opinion was 2-1, and the deadline to seek en banc review was December 17, 2012 and we will not know if certiorari will be sought until after March 4, 2013 deadline. FDA did take action on December 17, 2012, FDA issuing a “Drug Safety Communication” concerning the product at issue in Caronia noting that “[m]any of the deaths occurred in patients who were prescribed Xyrem for unapproved uses such as fibromyalgia…." Notably, fibromyalgia was among the uses promoted off-label in Caronia.

The command of the Constitution is a mere ten words: “Congress shall make no law … abridging the freedom of speech …” In 1942, the United States Supreme Courtmade a profound and admittedly erroneous assumption that is taking decades for the Court to recognize and gradually walk back. In Valentine v Chrestensen, the Supreme Court held that, “[T]he Constitution imposes no such restraint on government as respects purely commercial advertising.” 316 U.S. 52, 54 (1942). From that ruling grew generations of cases confounding the public beyond comprehension and leaving legal scholars pleasantly divided. It was not until the mid 1970’s that the Supreme Court reversed itself finding:

As to the particular consumer’s interest in the free flow of commercial information, that interest may be as keen, if not keener by far, than his interest in the day’s most urgent political debate.

Va. Pharmacy Bd. v. Va. Consumer Council, 425 U.S. 748, 783 (1976). In Caronia, the Second Circuit noted that the FDCA makes it a crime to misbrand or conspire to misbrand a drug, but the statute and its accompanying regulations do not expressly prohibit or criminalize off-label promotion. Caronia, at *8. The Second Circuit elected to avoid deciding the Constitutionality of the FDCA, instead questioning the government’s prosecution. Caronia, at *26. The result is the same for Mr. Caronia, but it enabled the Court to reach its result without finding the FDCA and regulations unconstitutional.

Despite finding that strict scrutiny applied to the speech at issue, the Caronia Court applied the four part intermediate scrutiny test for commercial speech in Central Hudson Gas & Elec. Corp. v. NY Public Service Comm., 447 U.S. 557, 562 (1980). In addressing the fourth prong of Central Hudson, the Second Circuit found the regulation is more extensive than is necessary to serve the government’s interest. Caronia, at *85. According to the Court, “if the government is concerned about the use of drugs off-label, it could more directly address the issue” and the Court set out six potential alternatives. Among those alternatives the Court stated:

The FDA could further remind physicians and manufacturers of, and even perhaps further regulate, the legal liability surrounding off-label promotion and treatment decisions.

Caronia, at *46.

In its Footnote 12, the Caronia Court states “Physicians and pharmaceutical manufacturers can be held accountable for off-label drug use through medical malpractice and negligence theories of liability.” Caronia, at *46. Ringing a bell first rung by Justice Rehnquist in his dissenting opinion in the Central Hudson case, suggesting that private litigants may replace governmental prosecutions, and nationwide off-label promotion tort claims could pose a significant new threat to companies with products used off-label, which could prove as intrusive and expensive as governmental prosecutions.

Paradoxically, criminal conduct and serving an urgent public health imperative are two sides of the same coin. Off-label use is often recognized by the medical community and FDA as the “standard of care” yet data studying 725 million prescriptions showed that 20% were off-label and of those 70% or over 100 million prescriptions were based on no or weak science. See David C. Radley, Susan N. Finkelstein & Randall S. Stafford, Off-label Prescribing Among Office-Based Physicians, 166 Arch Intern Med 1021 (American Medical Association 2006), available at http://archinte.jamanetwork.com.

Prior to Caronia, FDA freely placed restrictions on every aspect of what, when, where, why, who and how a manufacturer disseminates information concerning regulated products, leaving private litigants little, if any, room to pursue a state law claim. Instinctively, it may seem refreshing to know that FDA regulated industry has weight of the U.S. Constitution to lessen the vice-grip FDA has on the dissemination of information, but lessening of FDA’s control and oversight may prove more intrusive and expensive.

Running alongside Caronia are other proceedings that should not be overlooked: PAR v US, the July 15, 2011 Citizens’ Petition filed by large pharma and US v Harkonen, a 9^th Circuit case.

Par v US

InOctober 2011, Par brought suit for declaratory relief in the District of Columbia to prohibit FDA from, among other things, enforcing “FDA’s unconstitutional and invalid regulations” restricting truthful non-misleading speech. Par Pharmaceutical, Inc. v. U.S., No. 11-cv-01820-RC, (D.D.C. filed October 14, 2011), ECF No. 1.

In seeking to dismiss PAR, FDA submitted the declaration of the Associate Director of Medical Policy and Director of the Office of Medical Policy (OMP) at the Center for Drug Evaluation and Research (CDER) at FDA. In the Declaration, FDA purports to “describe... FDA’s procedures and policies with respect to the communication of promotional information about off-label uses.” Id., ECF No. 14, p. 1.

To the extent FDA’s procedures and policies are stated, they are stated like a riddle, not stating specifically what is permitted., FDA explains its policies and procedures as follows:

Nor does FDA regard a manufacturer’s knowledge that an FDA-approved drug was being prescribed by healthcare professionals for an unapproved use as establishing, by itself, a manufacturer’s objective intent that the drug be used for an unapproved use.

Id., ECF No. 14, p. 7. While FDA sheds dim light on what evidence will suffice to render “truthful speech” or knowledge of facts illegal stating: “determining …the manufacturer’s ‘objective intent,’… can be based on …the circumstances surrounding the drug’s distribution… and may include “additional evidence suggesting…a deliberate strategy to encourage off-label prescribing.” Id., ECF No. 14, p. 8.

Citizen’s Petition

On July 15, 2011, a number of manufacturers, submitted a citizens’ petition concerning a safe harbor concerning the exchange of scientific information and certain off-label communications. Rather than addressing the issue head-on, and perhaps because the First Amendment presents serious impediments to FDA’s ability to draft a coherent rule, FDA has been issuing piecemeal draft guidance documents, which themselves are failing to add clarity to identifying information that may be disseminated. See Docket No. FDA-2011-P-0512

The Emerging Tort of Off-Label Promotion

Prior to Caronia, it was a steep uphill climb for a plaintiff to claim dissemination of information for regulated products was not exclusively the realm of FDA. Caronia suggests that FDA may not have the stranglehold it has assumed. Unfortunately, at the pleadings stage, whether a private action can survive challenges based on preemption, primary jurisdiction, First Amendment challenges or the prohibition against private litigant’s pursuing claims under the FDCA may depend more on the underlying factual allegations than on a rote application of the law supporting dismissal.

Over the past year, a growing number of courts throughout the country have wrestled with emerging tort claims that attempt to circumvent the preclusive effect of current law by alleging promotion for off-label use or negligent marketing. Murthy v. Abbott, 2012 U.S. LEXIS 171246 (S.D. Tex. December 3, 2012), involved Texas Civil Practice and Remedies Code Section 82.007 which provides a statutory presumption of no liability where a products liability claim alleges injury “caused by a failure to provide adequate warnings or information with regard to a pharmaceutical…if…the warnings or information…were those approved by” the FDA. Tex. Civ. Prac. & Rem. § 82.007. The statute further provides that a claimant may rebut the presumption where she can “establish” that: (1) the manufacturer “recommended, promoted or advertised the pharmaceutical product for an indication not approved by the FDA”; (2) the product was used as “recommended, promoted or advertised”; and (3) the claimant’s injury was “causally related to the “recommended, promoted or advertised” use. Id. at §§ (b)(3), (b)(4).

In Murthy, Plaintiff alleged that the FDA-approved labeling was prescribed off-label because it was indicated for patients with moderate-to-severe active rheumatoid arthritis who had an inadequate response to one or more other drugs. Plaintiff’s physician testified that she had early rheumatoid arthritis and that she was responding well to other drugs rendering the prescriptions “off-label.” The Court found that Plaintiff pled sufficient facts to raise an “off-label promotion claim” where the “Abbott sales representatives repeatedly promoted and encouraged her physician to use Humira, in patients with ‘early’ RA and in patients that did not fit the [drug’s] study ‘criteria.’” 2012 U.S. LEXIS 171246, *9.

Aboard the Titanic of the FDA’s regulation of off-label promotion rides potent cargo for manufacturers: deference to agency determinations and federal preemption. While many challenges to private claims for off-label promotion exist and should prevail, it may be years before this area of the law is settled. While it is uncertain how industry will fare as Caronia is tested in future litigation, what is certain is that facts matter and any manufacturer with products used off-label should view Caronia as the tip of the iceberg.

Off-Label Promotion and the First Amendment: How a $25 Fine and 100 Hours of Community Service Sank the Titanic

Michael A. Walsh — Wed, 05 Dec 2012 00:00:00 -0500

December 3, 2012 was a good day for Alfred Caronia, a sales rep for a drug manufacturer. It was three years to the day after his trial for off-label promotion resulted in a conviction for a misdemeanor and subjected him to a $25 fine and 100 hours of community service. Less happy is one of his co defendants, Dr. Gleason, who settled before trial and, as a result of his federal criminal plea, spiraled downward taking his own life. So why is this sad little case ripping the fabric of FDA enforcement of off-label promotion?

On December 3, 2012, two years to the day from hearing the case, the Second Circuit, in United States v. Caronia, ruled that the FDA’s civil and criminal enforcement of drug companies violates the First Amendment. Not unlike the iceberg that sank the Titanic, it wasn’t the small object on the surface that presented the risk, it is what was lying beneath the surface.

Off-label promotion cases are simply too big and the stakes (i.e. losing the ability to conduct business) are simply too great for a company to seriously consider defending an off-label marketing claim. The government has poured tens of billions of dollars in fines and penalties into its coffers based on an enforcement regime that a federal circuit court has now found to be in violation of the First Amendment to the U.S. Constitution. Ironically, massive off-label promotion plea agreements involving big pharma have been the fodder of daily news reports for many years; yet, it took a small case involving a individual sales rep to question the constitutionality of FDA’s enforcement of off-label promotion.

While this case will provide real and immediate comfort to a great many sales representatives, manufacturers and distributors of FDA regulated products may see this case as a watershed. As suggested at footnote 12 in the Caronia opinion and by Justice Rehnquist in his dissenting opinion in the landmark Central Hudson case, private litigants may replace governmental prosecutions, and nationwide off-label promotion tort claims could pose a significant new threat to companies with products used off-label. Aboard the Titanic of FDA regulation of off-label promotion rode very potent cargo for manufacturers; deference to agency determinations, and, most importantly, preemption. Both may have gone down with the ship.

The command of the Constitution is a mere ten words:

“Congress shall make no law … abridging the freedom of speech …”

Yet the FDA places restrictions on what, when, where, why, who and how a manufacturer may disseminate information concerning regulated products. Over decades, the statutory and regulatory framework has expanded, placing more and more restrictions on information that may be disseminated. The enforcement of these regulations gradually infringed upon First Amendment protections and the court that have looked at the issue have expressed serious concerns that the government infringes First Amendment protections.

Off-label use presents a conundrum where a manufacturer with reliable scientific and medical information regarding a product is throttled under the rubric of off-label promotion, while a physician lacking any scientific or medical basis is free to prescribe or use that product. Effectively, the manufacturer is silenced while the physician, the consumer, and even academia are unrestrained in recommending any product for any use. From this conundrum, an urgent moral and ethical imperative exists to provide more—not less—reliable scientific and medical information.

When did it all begin?

In 1942 the United States Supreme Court made a profound and admittedly erroneous assumption that is taking decades for the Court to recognize and gradually walk back. In Valentine, the Supreme Court held that,

[T]he Constitution imposes no such restraint on government as respects purely commercial advertising.

From that ruling grew generations of cases confounding the public beyond comprehension and leaving legal scholars pleasantly divided. It wasn’t until the mid 1970’s that the Supreme Court said what the public instinctively knew all along:

As to the particular consumer’s interest in the free flow of commercial information, that interest may be as keen, if not keener by far, than his interest in the day’s most urgent political debate.

In the ensuing decades the Supreme Court has continued evolving. The debate circles around a few simple questions:

Is it speech? If yes: is the regulation subject to strict scrutiny and, if it is, test it under intermediate scrutiny anyway.

Is commercial speech involved and does the regulation survive the four prong Central Hudson intermediate scrutiny test?

Orphan Medical manufactured and marketed a sleep-inducing depressant, Xyrem. The drug had a black box and was labeled for serious potential side effects. A government informant, Dr. Charno, who had pled guilty to submitting fraudulent medical insurance bills, contacted Caronia, asking for information on off-label use and for a presentation by a medical liaison. Caronia arranged the presentation, and the sting operation resulted in prosecution. Unfortunately for Caronia, his employer admitted to a conspiracy to misbrand and took a plea bargain, and the former manager testified that he had personally instructed the medical liaison to misbrand the product on prior occasions.

In denying Mr. Caronia’s motion to dismiss, the trial court was prescient in stating:
Reduced to its essence, Caronia’s argument is that the government cannot restrict truthful, non-misleading promotion by a pharmaceutical manufacturer (or its employees) to a physician of the off-label uses of an FDA-approved drug … Squarely, Caronia’s constitutional attack calls into question America’s regulatory regime for the approval and marketing of prescription drugs.

The trial court went on to state: “The Constitutional issues raised in Caronia’s motion are very much unsettled, not only in the circuit but nationwide.”

The Second Circuit noted that the FDCA makes it a crime to misbrand or conspire to misbrand a drug, but the statute and its accompanying regulations do not expressly prohibit or criminalize off-label promotion. Based on the statutory and regulatory framework, the Second Circuit elected to avoid deciding the Constitutionality of the FDCA, and instead questioned the government’s prosecution. The result is the same for Mr. Caronia, but it enabled the Court to reach its result without finding the law unconstitutional. In this regard, the Court stated:

Thus, under the principle of constitutional avoidance, explained infra, we construe the FDCA as not criminalizing the simple promotion of a drug's off-label use because such a construction would raise First Amendment concerns. Because we conclude from the record in this case that the government prosecuted Caronia for mere off-label promotion and the district court instructed the jury that it could convict on that theory, we vacate the judgment of conviction.

The Court went on to state:

To the extent there is any ambiguity as to whether off-label promotion is tantamount to illegal misbranding, we construe the FDCA narrowly to avoid a serious constitutional question. As we now explain, we decline the government's invitation to construe the FDCA's misbranding provisions to criminalize the simple promotion of a drug's off-label use by pharmaceutical manufacturers and their representatives because such a construction - and a conviction obtained under the government's application of the FDCA - would run afoul of the First Amendment.

In arguing the case to the Second Circuit, the government took a position it had not taken at the trial court level, arguing that the speech at issue “was not speech at all but was conduct evidence of intent to misbrand.” The Second Circuit was unimpressed with the government’s shameful ploy rejecting it as “simply not true” “the government clearly prosecuted Caronia for his words – for his speech.”

Following the Supreme Court in Sorrell, the Second Circuit analyzed the case under both strict scrutiny and intermediate scrutiny stating:

First, we conclude that the government's construction of the FDCA's misbranding provisions imposes content and speaker based restrictions on speech subject to heightened scrutiny. Second, we conclude the government cannot justify a criminal prohibition of off-label promotion even under Central Hudson's less rigorous intermediate test.

The Court found heightened scrutiny because the “government’s construction of FDCA’s misbranding provisions” is “content and speaker based” and therefore subject to heightened scrutiny. Content based because it distinguishes “favored speech” on the basis of ideas expressed. Particularly notable to the Second Circuit was that off-label speech is prohibited while off-label use is not. In addressing the “speaker based” aspect, the Circuit Court observed that the government’s construction only barred manufacturers from speaking where others are free to speak.

The Court went on to apply the now well known Central Hudson four part test holding as follows:

1. The commercial speech must concern unlawful activity and not be misleading. The court found the off-label promotion at issue concerned a lawful conduct and the information was truthful.

2. The asserted governmental interest in drug safety and public health must be substantial and the Circuit Court so found.

3. The regulation must directly advance the governmental interest asserted. In finding that the prohibition failed the third prong of Central Hudson, the Court found:

[I]t does not follow that prohibiting the truthful promotion of off-label drug usage by a particular class of speakers would directly further the government's goals of preserving the efficacy and integrity of the FDA's drug approval process and reducing patient exposure to unsafe and ineffective drugs.

Not only did the Court find that the prohibition failed to advance the government’s interest, it found the opposite:

[P]rohibiting off-label promotion by a pharmaceutical manufacturer while simultaneously allowing off-label use ‘paternalistically’ interferes with the ability of physicians and patients to receive potentially relevant treatment information; such barriers to information about off-label use could inhibit, to the public's detriment, informed and intelligent treatment decisions.

Recognizing that it is the physician's role to consider multiple factors to determine the best course of action for a patient, the Court stated:

The government's construction of the FDCA essentially legalizes the outcome - off-label use - but prohibits the free flow of information that would inform that outcome. If the government's objective is to shepherd physicians to prescribe drugs only on-label, criminalizing manufacturer promotion of off-label use while permitting others to promote such use to physicians is an indirect and questionably effective means to achieve that goal. Thus, the government's construction of the FDCA's misbranding provisions does not directly advance its interest in reducing patient exposure to off-label drugs or in preserving the efficacy of the FDA drug approval process because the off-label use of such drugs continues to be generally lawful. Accordingly, the government's prohibition of off-label promotion by pharmaceutical manufacturers ’provides only ineffective or remote support for the government’s purpose.’

4. The regulation must not be more extensive than necessary. The courts have described this prong as whether there is a “reasonable fit” not the least restrictive means. The Second Circuit found the regulation is more extensive than is necessary to serve the government’s interest. The Court then provided a number of alternatives the government could pursue that would not implicate the First Amendment. According to the Court, “if the government is concerned about the use of drugs off-label, it could more directly address the issue” and the Court set out six potential alternatives:

i. It could guide physicians and patients in differentiating between misleading and false promotion, exaggerations and embellishments, and truthful or non-misleading information.

ii. The government could develop its warning or disclaimer systems, or develop safety tiers within the off-label market, to distinguish between drugs.

iii. The government could require pharmaceutical manufacturers to list all applicable or intended indications when they first apply for FDA approval, enabling physicians, the government, and patients to track a drug's development.

iv. To minimize off-label use, or manufacturer evasion of the approval process for such use, the government could create other limits, including ceilings or caps on off-label prescriptions.

v. The FDA could further remind physicians and manufacturers of, and even perhaps further regulate, the legal liability surrounding off-label promotion and treatment decisions. In its Footnote 12 the Court states “Physicians and pharmaceutical manufacturers can be held accountable for off-label drug use through medical malpractice and negligence theories of liability.”

vi. Finally, where off-label drug use is exceptionally concerning, the government could prohibit the off-label use altogether.

According to the Court, “[t]he possibilities are numerous indeed.”

What should take the immediate attention of every company who markets and distributes FDA regulated products is the Court’s fifth recommendation concerns private litigation. Also notable is that where there is a right to speak, there is soon may follow a claim that there is a corresponding duty.

In conclusion, the Court purports to have a simple holding, stating:

We construe the misbranding provisions of the FDCA as not prohibiting and criminalizing the truthful off-label promotion of FDA-approved prescription drugs. Our conclusion is limited to FDA-approved drugs for which off-label use is not prohibited, and we do not hold, of course, that the FDA cannot regulate the marketing of prescription drugs. We conclude simply that the government cannot prosecute pharmaceutical manufacturers and their representatives under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug.

The dissent fails to put the core issue in this case. The recognition by the medical community and, more importantly, the FDA that off-label use often represents the “standard of care” thus creating an irreconcilable clash with both the First Amendment and Due Process as the law is currently enforced. The urgent public health issue for state and federal regulators, the medical community and manufacturers is the dissemination of truthful, reliable medical and scientific information, and to focus enforcement on false, unsupported and unreliable misinformation that presents a real and immediate risk to the public.

While Caronia is major development in the FDA’s regulation of drug and device product promotion that will usher in a new era in how truthful information is disseminated, it may also signal the beginning of a new wave of private litigation.

Partner Mike Walsh is a contributing author to Recent Developments in Food and Drug Law: Leading Lawyers on Dealing with Increased Enforcement, Keeping Up-To-Date with FDA Requirements, and Developing Compliance Practices published by Thomson Reuters. To read the full chapter, click here.

FDA Shows the Fizz in FSMA Suspending the Registration of a Food Manufacturer

Michael A. Walsh — Mon, 03 Dec 2012 00:00:00 -0500

On November 26, 2012, for the first time, FDA displayed a major new weapon in its enforcement arsenal by suspending the registration of Sunland, a food manufacturer.

The Food Safety Modernization Act of 2011 (FSMA) (pronounced Fizz-Ma) granted the Food and Drug Administration “expanded authority” to suspend the registration of a food manufacturer, detain and seize any regulated food determined to be unsafe, adulterated or misbranded, “or otherwise failing to meet the requirements of the food safety law,” and to imposed significant penalties. Section 402 (21 USC 350d(b) of the Act grants FDA broad discretion and provides for suspension of registration:

If the Secretary determines that food manufactured, processed, packed, received, or held by a facility registered under this section has a reasonable probability of causing serious adverse health consequences or death to humans or animals, the Secretary may by order suspend the registration of a facility.

The suspension Order can extend to not only the company that “created, caused, or was otherwise responsible for such reasonable probability” but it extends further to those “that knew of, or had reason to know of, such reasonable probability and packed, received, or held such food.”

The Sunland Facts

In September 2012 the Centers for Disease Control and Prevention (CDC) and FDA investigated a multistate outbreak of Salmonella Bredeney (a pathogen that has a “reasonable probability of causing serious adverse health consequences or death to humans”) involving 35 persons infected from 19 states; eight of these persons were hospitalized as a result of their infection. FDA and CDC focused on Trader Joe’s™ brand Valencia Creamy Salted peanut butter made with Sea Salt as the likely source of this outbreak. Sunland was the sole manufacturer of Trader Joe’s™ brand Valencia Creamy Salted peanut butter made with Sea Salt.

FDA followed up with an inspection of Sunland’s facilities which included reviewing manufacturing records and in its FDA Notice 483 noted a history of “contamination with Salmonella” “based on the conditions in your facility… over the past 3 years [and based on this history] FDA has determined that these products have a reasonable probability of causing serious adverse health consequences or death to humans.”

After a “voluntary” product recall in September 2012 and shutting down a plant in October, Sunland informed the FDA of its proposed corrective action plan on November 20, 2012.

In response, on November 26, 2012, FDA issued not a follow up letter but its first ever formal notice stating:

The U.S. Food and Drug Administration (FDA) hereby suspends the registration for your food facility…

In its suspension Order FDA noted that its investigators tested samples and obtained copies of laboratory testing records dating back to 2009 reflecting the presence of Salmonella (including the Salmonella Bredeney strain) in a number of finished product lots and that “at least a portion” of the lots were distributed. FDA further noted “serious violations of our Current Good Manufacturing Practice (CGMP) regulation for food” and concluded that these violations caused certain products to be “adulterated” under the FDCA. FDA concluded that “these results demonstrate that food manufactured, processed, packed, and held by your facility has a reasonable probability of causing serious adverse health consequences or death to humans.” The suspension Order is effective immediately and prevents Sunland introducing its product into commerce, including importing products.

A stunned Sunland issued a press release on November 27, 2012 stating:

Sunland had hoped to recommence its shelling operation on November 26, 2012 … Sunland expected that any agency concerns with its plans would be part of the ongoing dialogue with the agency. The agency’s order suspending Sunland’s registration on November 26, 2012 was unexpected and the company is disappointed by this development. .. We believe that drawing any inferences much less conclusions about the Company’s practices based solely on the observations as set forth in the Form 483 without considering the Company’s response would be wholly premature and unduly prejudicial to Sunland.

Additional Powers and Penalties Granted by FSMA

A violation of the FDA suspension Order is a “prohibited act” and, despite FDA’s misciting one of the statutory provisions in its Order, violating the suspension Order will result in significant civil and criminal enforcement. In addition to FDA’s new power to suspend a company’s registration, FSMA granted FDA seizure and detention powers and added significant civil penalties (i.e. “not more than $1,000,000 for each offense and every day is considered a separate offense) and expands on the criminal sanctions under the Food Drug and Cosmetic Act.

Under prior law, the penalty was up to 1 year in prison. Now, if the offense results in serious illness “the person committing the violation shall be imprisoned for not more than 5 years” and 10 years if it results in death. Couple these sanctions with the government’s use of the Park Doctrine in prosecuting “C” suite officers, even when they had no actual knowledge of an offense, and there should be no question that ensuring compliance is the first item on the agenda and certainly compliance can no longer wait until an inspector knocks at the door.

Hearing Options

Under the Act a suspended entity has what FDA refers to as an “opportunity” to request an informal hearing. The hearing is immediate and the burden of proof is on the suspended entity. Under 21 350d(b)(2) within two (2) days of the suspension Order (provided notice is given to FDA within one (1) day) or some other agreed upon date on the (1) actions “required” for reinstatement” and “why the registration should be reinstated.” As in granting the Order itself, the statute provides that “the Secretary shall reinstate a registration [but only] if the Secretary determines, based on the evidence presented, that adequate grounds do not exist to continue the suspension of the registration. Under the Act, broad discretion is given to the FDA to weigh the evidence.
If the Secretary continues the suspension, the Act provides that the “Secretary shall require the registrant to submit a corrective action plan” and the FDA must review the plan within 14 days of submission.

In lieu of the hearing provided under the Act, FDA’s suspension Order provides that the suspended entity may forego the hearing and submit its proposed corrective action plan.

Compliance Cannot Wait Until After The Inspectors Arrive

The “new normal” includes the real threat that FDA will exercise its suspension power before issuing a formal warning letter. A lengthy history of recalcitrance or non-compliance with multiple inspection failures is not a necessary prerequisite to FDA exercising its power to suspend a company’s registration.

The Sunland case demonstrates that FDA will exercise its discretion when it determines a product has “a reasonable probability of causing serious adverse health consequences or death to humans or animals.” It is important to recognize that the Act does not limit its scope to the manufacturer alone but extends to any facility “that knew of, or had reason to know of, such reasonable probability and packed, received, or held such food.” Nor is FDA required to take action only when a deadly pathogen is at issue.

Three things manufacturers and distributors must do:

Compliance, Compliance, Compliance:

Having a Comprehensive Plan that includes responding to FDA inspections is an essential first step. A robust response with a comprehensive corrective action plan demonstrating the ability to immediately implement corrective measures might be the one thing that prevents a suspension when the FDA comes knocking.

The FDA and the First Amendment: Off-Label Promotion, Due Process, and the Commercial Speech Doctrine

Michael A. Walsh — Thu, 29 Nov 2012 00:00:00 -0500

Partner Mike Walsh is a contributing author to Recent Developments in Food and Drug Law: Leading Lawyers on Dealing with Increased Enforcement, Keeping Up-To-Date with FDA Requirements, and Developing Compliance Practices published by Thomson Reuters. To read the full chapter, click here.

To read a case update related to these rulings, please click here.

Pharmacy Compounding: The Mess, the Excuse, and the Proposal

Michael A. Walsh — Thu, 15 Nov 2012 00:00:00 -0500

The clarion call recently ushered in by the meningitis outbreak related to unsanitary practices at the Massachusetts based New England Compounding Center (“NECC”) caused Congress to take a look at a legislative void that has existed since 2002. On November 15, 2012, after hearing compelling and emotional testimony from the family of a victim, a sanctimonious Congress raked an evasive and nonresponsive FDA Commissioner Hamburg over the coals for failing to coherently explain FDA’s authority to regulate and oversee the practice of compounding pharmacy generally and for failing to follow up on its 2002 Warning Letter to NECC.

Pharmacy compounding of medications predates the Food Drug and Cosmetic Act and is as old as the practice of medicine itself. The NECC incident highlights the risk occasioned by both the failure of the State of Massachusetts to properly oversee unsanitary practices of a large pharmacy and well as FDA’s failure to follow up on a Warning it issued to NECC in, coincidentally, 2002.

While the safety and efficacy of the compound medication itself was not at issue (nor has it been suggested that the medications were improperly prescribed or were not medically indicated), the NECC incident highlights the increasing demand for modified prescription products. Importantly, compounding products are derived not from the highly regulated FDA drug approval process but from the science and art of practicing medicine by individual physicians treating individual patients. But the NECC debacle has been conflated into something that goes far beyond oversight of sanitary practices at large compounding pharmacies that provide these unique products. Congress is now struggling with the decision to grant FDA authority to treat certain compounding pharmacies as “new drug manufacturers” for the purposes of approval, regulation, oversight, inspection and enforcement.

During the November 15, 2012 hearing, unlike the representative of the State of Massachusetts who plainly admitted the state dropped the ball in overseeing NECC, FDA Commissioner Hamburg bobbed and weaved attempting to deflect any responsibility for its failure to act, complaining instead throughout the hearing that the Courts were to blame for making the regulation of Pharmacy Compounding “very complicated.” The FDA Commissioner was referring to the 2001 Ninth Circuit opinion in Thompson v Western States 238 F.3d 1090 (9th Cir. 2001) in which the court ruled that the 1997 FDAMA Pharmacy Compounding provisions (21 USC § 353a) were invalid on First Amendment grounds. The case eventually worked its way to the Supreme Court where the Court affirmed the Ninth Circuit, but the Supreme Court did not resolve the issue of whether the entire Pharmacy Compounding provision was invalid leaving the Ninth Circuit’s opinion intact. 535 U.S. 357 (2002). Despite the statutory void, FDA was not without significant authority under the provisions of the FDCA and regulations concerning adulteration to take immediate action under circumstances presented by NECC even in the absence of the Pharmacy Compounding provisions. 21 USC § 351. As a result of the Western States opinion, in 2002 FDA issued its Compliance Policy Guide for Pharmacy Compounding (“CPG”).

While FDA has been “regulating” pharmacy compounding under the force of the CPC, it is merely a compliance guide that does not have the force of law. FDA has scheduled an all day hearing for December 19, 2012 inviting representatives of the states for the purpose of “developing a framework” for oversight of pharmacy compounding operations.

The “complexity” the Commissioner alluded to at the November 15, 2012 hearing did not come about until 2007 when the Fifth Circuit disagreed with the Ninth Circuit on the severability of the advertising provisions and ruled the 1997 FDAMA Pharmacy Compounding provisions were in effect (minus the advertising provision the Ninth Circuit and US Supreme Court found violated the First Amendment). In response to the Fifth Circuit “complicating” matters in 2007, FDA issued its notice explaining that FDA would continue to regulate this area of the law under its CPG.

Following the NECC meningitis outbreak, Congress has proposed legislation entitled the “Verifying Authority and Legality in Drug Compounding Act of 2012.” This proposal has much in common with the current/prior Compounding Act (21 USC 353a) but differs in that it provides for registration, inspection rights, adverse event reporting and “manufacturing” in advance of prescriptions based on an FDA waiver. If the hearing before Congress on November 15, 2012 is any guide, Congress intends to push through legislation before the end of the year. No doubt that clarity is needed, but as we saw with the Compounding Act in 1997, if Congress fails to take the time to carefully reason through this issue, the Court will once again be forced to sort it out.

Irrespective of what FDA or the State of Massachusetts could or should have done to prevent NECC from distributing adulterated products, the current legislative and regulatory train-wreck of Pharmacy Compounding lies at the door step of Congress where it has been for over 10 years.

WARNING: FDA seeks greater surveillance, increased enforcement and authority for civil penalties for dietary supplement manufacturers

Michael A. Walsh — Wed, 03 Oct 2012 00:00:00 -0500

On October 2, 2012 the Office of the Inspector General issued a study entitled: “Dietary Supplements: Structure/Function Claims Fail to Meet Federal Requirement” (Study) and a report entitled “Dietary Supplements: Companies May Be Difficult To Locate in an Emergency” (Report).

The Study was part of the Department of Health and Human Services OIG Work Plan for 2012 and addresses concerns raised by the General Accounting Office and public interest groups over “structure/function claims” on dietary supplement labels. FDA had been “urged …to strengthen oversight of these claims because they are potentially misleading and may lack scientific support.” The Food Drug and Cosmetic Act (FDCA) grants FDA authority to pre review labels for drug and medical device products, but FDA lacks authority to pre review or approve claims for food and dietary supplements before products enter the market. While manufacturers are required to have “substantiation” (i.e. competent and reliable scientific evidence) to support claims, this support is not required to be submitted to FDA. The concern that “structure and function” claims raise for the FDA is that such products are often “intended to diagnose, treat, cure, or prevent any disease.” Such claims render the products “drugs” under the FDCA and drugs require pre approval, significant scientific support and FDA approved labeling.

The OIG reviewed a sample of dietary supplement labels “marketed for weight loss or immune system support…to determine the extent to which they complied with FDA regulations.” They further reviewed the “substantiation” for the claims as well as the reporting to FDA by the manufacturers for the claims. The OIG concluded that labeling was “inconsistent with FDA guidance on competent and reliable scientific evidence,” many labels lacked disclaimers, and 20 percent included “drug” claims. While the implication in the Study is that as much as 20 percent of marketed products violate the Act, it is not at all clear the extent to which the labels studied are representative of products purchased.

OIG made a number of significant recommendations including that “FDA seek explicit statutory authority to review substantiation for structure/function claims to determine whether they are truthful and not misleading” and that FDA improve its oversight and enforcement over such claims. FDA has agreed with the recommendation to improve oversight and enforcement and is considering the recommendation for more power regarding labeling.

Accompanying the OIG study is a report entitled “Dietary Supplements: Companies May Be Difficult To Locate in an Emergency.” This report notes that a significant number of companies failed to register with FDA as required under the FDCA and 20% failed to provide contact information, required under the FDCA. Among the recommendations agreed to by FDA is a request for statutory authority to impose civil monetary penalties on companies that fail to comply.

These reports represent a significant step toward significantly increasing FDA’s enforcement power and the regulation of food products that are used by an estimated 80% of adults in a $20 billion dollar industry for products that supplement diets. It also represents a further warning that FDA is seeking new powers to punish those manufacturers who fail to comply with labeling requirements. Increasingly, knowledge of the rules and compliance should be the number one agenda item for all manufacturers and marketers of dietary supplements.

According to the DC Circuit “FDA cannot get around the First Amendment by pleading incompetence…”

Michael A. Walsh — Fri, 31 Aug 2012 00:00:00 -0500

The D.C. Circuit rejects compelled government speech requiring graphic cigarette ads

In R.J. Reynolds v FDA, cigarette manufacturers alleged that government compelled graphic images on cigarette packages violated the First Amendment and the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 553(b)(3), 705, 706(2)(A). 845 F. Supp. 2d 266 (D.D.C. 2012). The Family Smoking Prevention and Tobacco Control Act (“Act” or “the Act”), Pub. L. No. 111-31, 123 Stat. 1776 (2009), gave FDA the authority to regulate the manufacture and sale of tobacco products and directed the FDA to “issue regulations that require color graphics depicting the negative health consequences of smoking.” See Pub. L. No. 111-31, § 201 (a) (amending 15 U.S.C. § 1333(d)) and required cigarette packages bear explicit textual warnings.

In June 2011, the FDA published its Final Rule requiring (among other things) the display of nine new textual warnings and the nine graphic images’ such as diseased lungs and a cadaver bearing chest staples on an autopsy table- on the top 50% of the front and back panels of every cigarette package manufactured and distributed in the United States on or after September 22, 2012. See, FDA, Required Warnings for Cigarette Packages and Advertisements, 76 Fed. Reg. 36,628 (June 22, 2011) (“the Rule”) Final Rule Required Warnings for Cigarette Packages.

FDA proposed a dramatic expansion of the existing health warnings, which it justified based on scientific literature and a “strong worldwide consensus” regarding a great number of countries/jurisdictions that have implemented pictorial warning requirements for tobacco packaging compared to the text-only warnings the United States currently requires. R.J. Reynolds Tobacco Co. v. FDA, No. 11-5332, 2012 U.S. App. LEXIS 17925 at fn3 (D.C. Cir. Aug. 24, 2012) (the “Circuit Court”).

The Circuit Court recognized the general rule “that the speaker has the right to tailor the speech[] applies not only to expressions of value, opinion, or endorsement, but equally to statements of fact the speaker would rather avoid.” R.J. Reynolds, 2012 U.S. App. LEXIS 17925 at *13 (quoting Hurley v. Irish-Am. Gay, Lesbian & Bisexual Grp. of Bos., 515 U.S. 557, 573-74 (1995)). This holds true whether individuals, or corporations are being compelled to speak. See Pac. Gas & Elec. Co. v. Pub. Utils. Comm’n, 475 U.S. 1, 16 (1986) (plurality opinion); W. Va. State Bd. of Educ. v. Barnette, 319 U.S. 624, 642 (1943).

The manufacturers contended that, to the extent the graphic warnings go beyond the textual warnings to shame and repulse smokers and denigrate smoking as an antisocial act, the message is ideological and not informational:

[B]y effectively shouting well-understood information to consumers, they explain, “FDA is communicating an ideological message, a point of view on how people should live their lives: that the risks from smoking outweigh the pleasure that smokers derive from it, and that smokers make bad personal decisions, and should stop smoking.” In effect, the graphic images are not warnings, but admonitions: “[D]on’t buy or use this product.”
R.J. Reynolds, 2012 U.S. App. LEXIS 17925 at *14.

In agreeing with the manufacturers that the images were ideological messages and not informational disclosures, the Circuit Court stated:

No one doubts the government can promote smoking cessation programs; can use shock, shame, and moral opprobrium to discourage people from becoming smokers; and can use its taxing and regulatory authority to make smoking economically prohibitive and socially onerous… But this case raises novel questions about the scope of the government’s authority to force the manufacturer of a product to go beyond making purely factual and accurate commercial disclosures and undermine its own economic interest—in this case, by making “every single pack of cigarettes in the country [a] mini billboard” for the government’s anti-smoking message.

Id. at *14-15.
Significantly, the Court sidestepped the threshold question of whether the packaging and branding even constitutes commercial speech but, for the purposes of its holding, assumed it was commercial speech to address the more salient issue:
Even assuming the Companies’ marketing efforts (packaging, branding, and other advertisements) can be properly classified as commercial speech, and thus subject to less robust First Amendment protections, a thorny question remains: how much leeway should this Court grant the government when it seeks to compel a product’s manufacturer to convey the state’s subjective—and perhaps even ideological—view that consumers should reject this otherwise legal, but disfavored, product?

Id. at *16.
The Circuit Court rejected the FDA’s attempt to rely on Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1986) to support requiring the proposed graphic images stating: “But by its own terms, Zauderer’s holding is limited to cases in which disclosure requirements are “reasonably related to the State’s interest in preventing deception of consumers.” Id. at *19 (quoting 471 U.S. at 651). Zauderer “carries no authority for a mandate unrelated to the interest in avoiding misleading or incomplete commercial messages.” Id. at *19 (quoting Glickman v. Wileman Bros. & Elliot, Inc., 521 U.S. 457, 491 (1996) (Souther, J., dissenting).

The Circuit Court noted that the proposed graphic images could not be justified on other grounds, such as a remedial measure for prior misleading claims, stating:
FDA does not frame this rule as a remedial measure designed to counteract specific deceptive claims made by the Companies, nor did it offer a remedial justification for the graphic warnings during the rulemaking proceeding… FDA has not shown that the graphic warnings were designed to correct any false or misleading claims made by cigarette manufacturers in the past. Nor did it show that absent disclosure, consumers would likely be deceived by the Companies’ packaging in the future. Rather, FDA framed the warnings as general disclosures about the negative health effects of smoking. The warnings thus represent an ongoing effort to discourage consumers from buying the Companies’ products, rather than, as in Warner-Lambert, a measure designed to combat specific deceptive claims.

R.J. Reynolds, 2012 U.S. App. LEXIS 17925 at *26-27.
According to the Circuit Court, the “FDA’s images are a much different animal. FDA concedes that the images are not meant to be interpreted literally, but rather to symbolize the textual warning statements, which provide ‘additional context for what is shown’...” Id. at *28. “They are unabashed attempts to evoke emotion (and perhaps embarrassment) and browbeat consumers into quitting. See Final Rule at 36,697 (“[R]isk information is most readily conveyed by warnings that elicit . . . strong emotional and cognitive reactions . . . .”). Id. at *30. “While none of these images are patently false, they certainly do not impart purely factual, accurate, or uncontroversial information to consumers.” Id.

The Circuit Court recognized that under Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557 (1980) the government must show that its asserted interest is “substantial” that the regulation “directly advances the governmental interest asserted,” and that “it is not more extensive than is necessary to serve that interest.” Id. (quoting 447 U.S. at 566). The Circuit Court assumed that the FDA’s interest in reducing smoking rates was substantial, but found that
FDA has not provided a shred of evidence—much less the “substantial evidence” required by the APA—showing that the graphic warnings will “directly advance” its interest in reducing the number of Americans who smoke.”… it is mere speculation to suggest that respondents who report increased thoughts about quitting smoking will actually follow through on their intentions…. Although FDA maintains the data “are suggestive” that large graphic warnings “may” reduce smoking consumption, id., it cannot satisfy its First Amendment burden with “mere speculation and conjecture.”
Id. at *36-37 (quoting Rubin, 514 U.S. at 487).

Highlighting the lack of evidence by the FDA, the Circuit Court noted “FDA could not even reject the statistical possibility that the Rule would have no impact on U.S. smoking rates.” Id. at *40. In its rulemaking FDA had estimated that with the enhanced warnings “the U.S. smoking rate will decrease by 0.212 percentage points” [an amount later reduced to .088] 75 Fed. Reg. 69,543. The FDA admitted the expected “decrease” was “in general not statistically distinguishable from zero.” Id. at 69,546. The Circuit Court further rejected FDA attempts to rehabilitate its findings by noting the analysis made only the "unremarkable point" that it is "difficult [to] determine with statistical precision the relative causal impact of the relevant contributing factors," particularly given the very small data sets to which FDA had access” stating:

But FDA cannot get around the First Amendment by pleading incompetence or futility. Because FDA bears the burden of justifying its proposed restraint on speech, it cannot claim--rather perversely--that its own analysis was irrelevant because it lacked precision and was based on insufficient data. Central Hudson requires FDA to find and present data supporting its claims prior to imposing a burden on commercial speech.

Id. at *41-42

The Circuit Court was unconvinced by the government’s attempt to reformulate its interest as purely informational, and that the FDA interest in “effective” communication was too vague. In this regard, the Circuit Court stated:

Indeed, the government’s chosen buzzwords, which it reiterates through the rulemaking, prompt an obvious question: “effective” in what sense? Allowing FDA to define “effectiveness” however it sees fit would not only render Central Hudson’s “substantial interest” requirement a complete nullity, but it would also eviscerate the requirement that any restriction “directly advance” that interest. See 447 U.S. at 566….. As such, FDA’s interest in “effectively communicating” the health risks of smoking is merely a description of the means by which it plans to accomplish its goal of reducing smoking rates, and not an independent interest capable of sustaining the Rule.

R.J. Reynolds, 2012 U.S. App. LEXIS 17925 at *43-44.

Since the Supreme Court began shaping its commercial speech doctrine in the 1970s, the courts have slowly moved towards extending First Amendment protections to businesses. The tide is advancing, particularly on the FDA and its ability to both limit what manufacturers may say and, as demonstrated in R.J. Reynolds, what manufacturers are compelled to say.

Direct-to-Consumer Advertising and the Learned Intermediary Doctrine

Michael A. Walsh — Wed, 22 Aug 2012 00:00:00 -0500

Widely touted as ushering Texas into the fold of states adopting the learned intermediary doctrine, in Hamilton v. Centocor, the Texas Supreme Court did much more including leaving the door open for future tort claims stating “future claims may give rise to the need for Courts to recognize an exception” to applying the learned intermediary doctrine. No. 10-0223, 2012 Tex. LEXIS 463 (Tex. June 8, 2012), available at http://www.supreme.courts.state.tx.us/historical/2012/jun/100223.pdf.

Centocor involved a prescription drug and claims that a Direct-to-Consumer (DTC) video supported fraud and misrepresentation claims. Plaintiff claimed that the drug, Remicade, caused a serious drug-induced side effect called lupus-like syndrome. Plaintiff alleged that the manufacturer’s video over-emphasized the benefits of the drug and intentionally omitted warnings about the potential side effects. Plaintiff argued that the video bypassed the physician-patient relationship and required the manufacturer to warn Plaintiff directly of the drug’s potential risks and side effects, thereby making the manufacturer liable for Plaintiff’s injuries.

At trial, the Plaintiff and her doctors “gave conflicting testimony about conversations concerning the risks and potential adverse effects associated with Remicade.” The treating physicians testified that they fully informed Plaintiff about the risks of developing lupus-like syndrome while Plaintiff stated that she received no warning. The Supreme Court noted that all of the physicians were aware of the risk of lupus-like syndrome when they chose to prescribe and treat Plaintiff with Remicade. Interestingly, Plaintiff continued receiving Remicade treatments for approximately six months after filing suit.

The Court of Appeals followed the Supreme Court of the State of New Jersey recognizing a sweeping exception to the learned intermediary doctrine for Direct-to-Consumer Advertisements and affirmed the jury award of more than 15 million dollars. In Perez v. Wyeth, the New Jersey Supreme Court noted that “[c]onsumer-directed advertising of pharmaceuticals thus belies each of the premises on which the learned intermediary doctrine rests.” 734 A.2d 1245, 1256 (N.J. 1999). As a result, the Perez court held that the learned intermediary doctrine no longer provided complete protection to pharmaceutical manufacturers when that company chose to market directly to consumers.”

Unlike Perez, in Centocor Plaintiffs testified that they first heard of Remicade through a textual banner displayed on the CNN news channel, which stated that the FDA had approved Remicade for the treatment of Crohn’s disease. The Texas Supreme Court recognized that “[t]his innocuous news report is a far cry from the basis for the Perez Court’s adoption of a DTC advertising exception where the pharmaceutical company ‘ma[de] direct claims to consumers for the efficacy of its product’” through prescription drug advertisements. In Centocor, Plaintiffs’ claims rested on the video that was viewed after her doctor had prescribed the drug and after the infusion process had begun. Furthermore, the Court characterized the video as an “informational supplement to the physician-patient relationship” and stated that “the placement of informational brochures in a physician’s office cannot fairly be equated with a course of mass advertising or be deemed direct-to-consumer advertising so as to remove the predicates of the learned intermediary doctrine.”

The Texas Supreme Court recognized that the learned intermediary doctrine has been a part of Texas jurisprudence for many years and articulated the doctrine as follows: “[u]nder the learned intermediary doctrine, the manufacturer of a pharmaceutical product satisfies its duty to warn the end user of its product’s potential risks by providing an adequate warning to a learned intermediary, who then assumes the duty to pass on the necessary warnings to the end user.” The Supreme Court went on to state:

The entire system of drug distribution in America is set up so as to place the responsibility of distribution and use upon professional people. The laws and regulations prevent prescription type drugs from being purchased by individuals without the advice, guidance and consent of licensed physicians and pharmacists. These professionals are in the best position to evaluate the warnings put out by the drug industry. Our holding in no way relieves the drug company in their duty to warn or to provide a product free of defects.

The Court further stated:

[W]hen a drug manufacturer properly warns a prescribing physician of the dangerous propensities of its product, the manufacturer is excused from warning each patient who receives the drug. The doctor stands as a learned intermediary between the manufacturer and the ultimate consumer. Generally, only the doctor could understand the propensities and dangers involved in the use of a given drug. In this situation, it is reasonable for the manufacturer to rely on the intermediary to pass on its warnings. However, even in these circumstances, when the warning to the intermediary is inadequate or misleading, the manufacturer remains liable for injuries sustained by the ultimate user.

While acknowledging that “the healthcare industry has experienced substantial changes, especially surrounding the marketing of prescription drugs,” it reasoned that before a patient receives a prescription medication, “it still went through the learned intermediary to get to [the patient].” The Court acknowledged that some courts have recognized circumstances that may support an exception to applying the learned intermediary doctrine in prescription drug cases but noted: “[b]ecause the unique circumstances and specific types of prescription drugs at issue in those cases are not before us, we need not determine whether Texas law should recognize exceptions to the learned intermediary doctrine in other contexts.”

The Texas Supreme Court rejected the Court of Appeals’ reasoning that DTC advertising relegates physicians to a mere dispensary role, but recognized that:

We agree that it is important to prohibit pharmaceutical manufacturers from disseminating grossly misleading advertising, and we note that Congress has enacted a comprehensive regulatory scheme, implemented by the FDA, which is meant to control the design, implementation, and marketing of prescription drugs, including both criminal and civil penalties for manufacturers that violate these regulations. We acknowledge that some situations may require exceptions to the learned intermediary doctrine, but without deciding whether Texas law should recognize a DTC advertising exception when a prescription drug manufacturer distributes intentionally misleading information directly to patients or prospective patients, we hold that, based on the facts of this case, no exception applies.”

According to the Supreme Court, “[o]n this record, the rationale for adopting a DTC advertising exception to the learned intermediary doctrine is simply non-existent.” But the Court did leave the door open stating that, “future cases may give rise to the need for the courts to recognize an exception to the doctrine in other contexts…” The Court went on to recognize that where “the warning to the intermediary was inadequate or misleading, the manufacturer remains liable for injuries sustained by the end user.”

Thus, in the context of prescription medications, where “inadequate or misleading” information concerning product risk forms the basis for the prescribing physician prescribing the product, a manufacturer may be liable and this information can come from multiple sources, including DTC advertisements, representations by sales representatives, on-line content and social media. Indeed, in Centocor, the Court recognized that when the drug company positively and specifically misrepresents its product and when the treating physician relies upon that representation, the drug company is liable when the representation proves to be false and harm results.

Nonetheless, even assuming that the Plaintiff presented sufficient evidence to show that the manufacturer’s warning to Plaintiff’s prescribing physicians was inadequate, the Plaintiff still must prove that the inadequate warning was the producing cause of Plaintiff’s injuries. In this case it was undisputed that all of Plaintiff’s medical providers were aware that Plaintiff could potentially develop serious side effects and the Plaintiff presented no evidence that Plaintiff’s prescribing physicians would have acted differently had the manufacturer provided a different warning.

In this era of electronic communications, this case underscores the need for vigilance in compliance with the FDCA concerning marketing materials. This case leaves the door wide open for future litigation where direct communications to physicians and patients form the basis for prescribing decisions, particularly where the product is being used off-label.

FDA and Social Media - The Safety and Innovation Act Gives FDA Two More Years to Explain the Rules on How Industry May Use the Internet and Social Media

Michael A. Walsh — Mon, 09 Jul 2012 00:00:00 -0500

As Congress resets the clock until after the elections, the Supreme Court issues significant opinions limiting governmental power to restrict commercial speech.

On July 9, 2012, President Obama signed into law the Food and Drug Administration Safety and Innovation Act giving the FDA two years to “issue guidance that describes Food and Drug Administration policy regarding the promotion, using the Internet (including social media), of medical products…” The FDA has been studying this issue since 1996. It has held numerous hearings, issued notices and guidance, and pursued countless enforcement actions based on on-line content. Nonetheless, despite over 16 years of deliberations, the rules remain unclear. In FDA’s defense, technology is a moving target and new media continues to evolve and revolutionize how society behaves and shares information. However, the lack of clear guidance has significantly silenced the one voice with the most reliable scientific information concerning medical products - the manufacturer. While it is not clear what guidance FDA will ultimately issue, it is clear that Congress has reset the clock for FDA to provide “guidance” until after the 2012 elections.

Despite Vague Rules, Civil Penalties and Criminal Prosecutions Set New Records
On July 2, 2012, the Department of Justice announced its landmark $3 billion dollar settlement of civil and criminal charges with GlaxoSmithKline concerning, among other things, its promotion of products for uses not approved by the FDA. Vague rules create an unfair playing field where regulatory agencies “interpret the rules as they see fit” and the risk to industry in defending protracted civil and criminal litigation includes exclusion from government programs, additional criminal prosecutions and, possibly, debarment (i.e. corporate death penalty of exclusion from marketing products).

The Supreme Court is Increasingly Critical of Vague Regulations that Limit Speech
Meanwhile, over in the Supreme Court and barely audible in the din of recent Court rulings on immigration and healthcare, the Supreme Court issued decisions in two significant cases involving vague regulations applied to limit commercial speech. In FCC vs. Fox, a case concerning broadcast content, the Supreme Court stated “[w]hen speech is involved, rigorous adherence to [due process] is necessary to ensure ambiguity [in the rules] does not chill protected speech.” The Court went on to state that, “[a] statute which either forbids or requires the doing of an act in terms so vague that men of common intelligence must necessarily guess at its meaning and differ as to its application violates the first essential of due process of law.” Also largely unreported was the Supreme Court’s opinion in Christopher v. SmithKline where the Court stated, “[deference to regulatory agencies] creates a risk that agencies will promulgate vague and open-ended regulations that they can later interpret as they see fit, thereby ‘frustrat[ing] the notice and predictability purposes of rulemaking.’”

According to the Supreme Court:

[i]t is one thing to expect regulated parties to conform their conduct to an agency’s interpretations once the agency announces them; it is quite another to require regulated parties to divine the agency’s interpretations in advance or else be held liable when the agency announces its interpretations for the first time in an enforcement proceeding and demands deference.

Supreme Court Holds that Even “False” Speech is Protected by the First Amendment
The Government has taken a number of approaches to avoid Due Process and First Amendment concerns. Among the approaches is that any “suggest[ion] that [a] drug is safe and effective” for an off-label use is “false or misleading,” irrespective of the scientific support for the suggestion. According to the Government, false and misleading statements are not protected by the First Amendment. Yet, in US v. Alvarez, decided by the Supreme Court on June 28, 2012, the Court stated: “[t]he Court has never endorsed the categorical rule the Government advances: that false statements receive no First Amendment protection.” Accordingly, even if the government declares “truthful” information to be “false,” the Supreme Court holding in Alvarez nonetheless extends Due Process and First Amendment protections to such speech.

Three Things to Focus on: Compliance, Compliance, Compliance
Understanding the rules, educating the workforce, establishing robust oversight and vigilance in taking corrective measure have never been more urgent or complex, particularly in this evolving era of online communication. Companies who redouble their efforts to continually assess, implement, educate, enforce, correct and revise their compliance programs will be rewarded, or at least not be punished. Those who do not, may find themselves operating under a government drafted Corporate Integrity Program.

STEPS TO TAKE:

Implement: A written policy based on your unique products and marketing. Employees must be informed of the regulatory significance of online content that is attributed to the company and its products.

Educate:
1. Establish a regular program of education.
2. Employees must know when on-line content is personal and when it is attributable to the company.

Enforce: Review online content. Know what your employees and third parties are saying about your products.

Correct: Take immediate corrective action when inappropriate content is identified: remove it, request it be removed (if you do not control it), and renounce it.

Reassess: As social media continues to evolve, take inventory of the social media technology and platforms that are being used and determine whether your compliance program fits. Ask:

1. What is the business interest the use advances?
2. Does the use advance that business interest?
3. Does the use comply with applicable law or require oversight?
4. Is the use covered by the Compliance Program? If not...

Revise: Compliance Program documents are a constant work-in-progress. If you do have the review of your Social Media Compliance Program on your to-do list, you may stay ahead of the regulators. If not, now is a good time.

Just How Wonderful is the FTC Ruling?

Michael A. Walsh — Mon, 04 Jun 2012 00:00:00 -0500

POM Wonderful v FTC - Both Sides Claim Victory even though the Court says: “neither side’s position as to the claims made or adequacy of substantiation has been totally vindicated.”

In an Initial Decision issued on May 17, 2012, a Federal Trade Commission Administrative Law Judge found that some of POM Wonderful’s health claims implied that its products treat disease and those claims were not supported by sufficient scientific evidence, rendering the claims “false and misleading” under the Federal Trade Commission Act (“FTC Act”) (15 U.S.C. § 41 et seq.). Although the Court entered a multi year cease and desist order against POM Wonderful, the ruling is by no means a victory for the FTC as the remedy it sought - prior review of marketing materials and the requirement for a heightened level of scientific research - was soundly rejected by the Court.

Despite the Court’s findings and injunction, POM declared victory stating “the FTC’s Administrative Law Judge has upheld POM Wonderful’s right to share valuable, scientifically-validated information about the health benefits of its safe food with consumers…. Through its lawsuit against POM, the FTC tried to create a new, stricter industry standard, similar to that required for pharmaceuticals, for marketing the health benefits inherent in safe food and natural food-based products. They failed.…”
Despite the Court’s Order that POM essentially follow the law and denying the relief FTC sought, the FTC likewise declared victory stating the Court upheld “an FTC complaint that POM violated federal law by making deceptive claims in some advertisements that their POM Wonderful 100% Pomegranate Juice and POMx supplements (POM products) would treat, prevent, or reduce the risk of heart disease, prostate cancer, and erectile dysfunction.”

The litigation began in September of 2012 when POM filed a declaratory judgment action in the District Court for the District of Columbia (10-cv-1539) on the grounds that FTC had adopted a “new standard” (as evidenced in the Nestle Consent Order and Iovate Stipulated Final Judgment with FTC which required prior review of product claims), without formal rulemaking requiring companies to obtain pre-approval of advertisements by FDA and two controlled clinical trials to substantiate health claims. According to POM, the “new standard” violated the First Amendment as a prior restraint prohibiting POM from disseminating truthful scientific information. FTC commenced its administrative proceeding shortly thereafter and sought to dismiss the federal court case on the grounds that its administrative proceeding rendered POM’s federal court action moot because FTC was not enforcing a “new standard” but merely requiring “prior review” as a remedy. The FTC trial took more than 5 months, included 2,000 exhibits, 46 company sponsored studies (costing over $35 million dollars), 14 testifying experts, 10 additional witnesses, over 3,000 pages of trial transcript, 4,000 findings of fact, and 4,000 pages of post trial briefing—resulting in an initial decision of 335 pages.

While the First Amendment undercurrent concerning the “prior review” remedy FTC sought is palpable, the Court’s decision skirted the issue by rejecting FTC’s request for “prior review” concluding that the remedy was not justified by the evidence.

Section 5(a) of the FTC Act provides that “unfair or deceptive acts or practices in or affecting commerce are hereby declared unlawful.” Section 12 of the FTC Act and 15 U.S.C. § 45(a)(1) prohibit the dissemination of “any false advertisement” in order to induce the purchase of “food, drugs, devices, services, or cosmetics.” 15 U.S.C. § 52(a)(2). According to the Court, “false advertisement” is defined as “an advertisement, other than labeling, which is misleading in a material respect[.]” 15 U.S.C. § 55(a).

The Court ruled that in determining whether an advertisement is misleading “[a] reasonable interpretation is one that would be shared by a ‘significant minority’ of reasonable consumers.” In re POM Wonderful LLC, No. 9344, 2012 FTC LEXIS 106, at *481 (May 17, 2012); In re Novartis Corporation, No. 9279, 127 F.T.C. 580, 1999 FTC LEXIS 63, at *22-23 (May 13, 1999); Kraft, 1991 FTC LEXIS 38, at *14; see also Telebrands Corp., 140 F.T.C. at 291 (“An ad is misleading if at least a significant minority of reasonable consumers are likely to take away the misleading claim.”).

In establishing the relative burden of proof required to substantiate the product claims, the Court recognized that:

[T]he Court must first determine what level of substantiation Defendants were required to have for their advertising claims, and this determination is a question of fact. Then, the Court must determine whether Defendants possessed that level of substantiation.... Defendants have the burden of establishing what substantiation they relied on for their product claims. The FTC has the burden of proving that Defendants’ purported substantiation is inadequate, and the FTC need not conduct or present clinical studies showing that the product does not work as claimed.

In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *534 (citing FTC v. QT, Inc., 448 F. Supp. 2d at 959 (citations omitted)).

The Court rejected FTC’s position regarding the level of substantiation required finding that “neither the FTC Act nor applicable case law requires well-designed, well-conducted, randomized, double-blind, placebo controlled human clinical studies (‘RCTs’) to substantiate all health-related efficacy claims.” In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *725.

The Court found non disease claims for “absolutely safe” foods adequate stating:

The greater weight of the persuasive expert testimony in this case leads to the conclusion that where the product is absolutely safe, like the POM Products, and where the claim or advertisement does not suggest that the product be used as a substitute for conventional medical care or treatment, then it is appropriate to favor disclosure. See also Pearson, 164 F.3d at 657 (under the First Amendment commercial speech doctrine, there is a “preference for disclosure over outright suppression”). In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *560.

Although the Court went on to find that a number of POM’s claims were implied disease claims, for which POM’s substantiation evidence was insufficient, it rejected FTC’s claim that RCT’s were required:

The preponderance of the evidence shows that some of the Challenged Advertisements disseminated by Respondents would reasonably be interpreted by consumers to contain an implied claim that the POM Products treat, prevent, or reduce the risk of heart disease, prostate cancer, or erectile dysfunction, and further, as to some of these advertisements, that these effects were clinically proven, as alleged in the Complaint. In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *9.
“[E]xpert testimony in this case demonstrates that competent and reliable scientific evidence is required for claims about nutritional supplements when such products are advertised to treat diseases or medical conditions. See also Daniel Chapter One, 2009 FTC LEXIS 157, at *233-35 (Initial Decision) (summarizing expert testimony and citing Natural Solution, 2007 U.S. Dist. LEXIS 60783, at * 11-12; National Urological Group, 645 F. Supp. 2d at 1190; Direct Marketing Concepts, 569 F. Supp. 2d at 300, 303). The greater weight of the persuasive expert testimony adduced at trial does not, however, support [FTC’s] position that, in order to have the required competent and reliable scientific evidence, Respondents must have had RCTs. In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *547-48.

Accordingly, the Court held that “[FTC] has demonstrated that Respondents did not possess adequate competent and reliable scientific evidence to substantiate the implied claims that the POM Products treat, prevent, or reduce the risk of heart disease or that clinical tests show the same. Complaint Counsel has, therefore, met its burden of proving that Respondents’ claims are false or misleading.” In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *570.

Having found POM “crossed the line,” the court then addressed whether the claims were “material.” In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *643; Kraft, 970 F.2d at 314. According to the Court, “[t]he basic question” on the issue of materiality “is whether the act or practice is likely to affect the consumer’s conduct or decision with regard to a product or service. If so, the practice is material, and consumer injury is likely, because consumers are likely to have chosen differently but for the deception.” In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *644 (citing FTC Policy Statement on Deception, Deception Statement, 1984 FTC LEXIS 71, at *171). Although there is a “presumption of materiality,” the Court avoided analyzing the presumption issue, finding instead that reliable evidence supported FTC’s claim that the false representations were material. In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *645.

Pre-Approval and the First Amendment

Harkening back to the claims asserted by POM in the district court case, FTC requested that the Court impose a requirement of “prior review” for subsequent claims by POM. The Court rejected FTC’s request, stating:

Complaint Counsel contends that requiring FDA pre-approval for disease claims is “reasonably related” to the violations in this case because (1) the FDA’s standard for labeling approval for a food-disease relationship claim under NLEA (“significant scientific agreement” by experts that the claim is supported) is “cited” in the FTC Enforcement Policy Statement on Food Advertising; and (2) the FDA standard for drug approval under the Food, Drug and Cosmetic Act (“adequate and well-controlled” clinical investigations by experts demonstrating effectiveness), is “similar” to the “competent and reliable scientific evidence” standard applied in Daniel Chapter One, and referred to in the FTC publication, Dietary Supplements: An Advertising Guide for Industry. However, the foregoing FTC publications do not constitute regulatory law, which is made either by adjudication, 15 U.S.C. § 45 (b); 5 U.S.C. § 556, or by promulgated regulation, 15 U.S.C. § 57b-3; 5 U.S.C. § 553. See Ford Motor Co. v. FTC, 673 F.2d 1008, 1009 (9th Cir. 1981) (noting that an administrative agency such as the FTC may announce principles through adjudication or rulemaking (citing NLRB v. Bell Aerospace Co., 416 U.S. 267, 294 (1974)).

In re POM Wonderful LLC, 2012 FTC LEXIS 106, at *704-05.

The Court found that FTC had not demonstrated that the existing rules were inadequate and disagreed with FTC that “FDA pre-approval is a ‘bright-line rule’ that will ‘significantly increase... enforceability… eliminate any confusion or ambiguities over the appropriate standard that Respondents must have to make disease claims… and [would] prevent litigation.’” Id. at *710.

FTC further argued that a pre-approval requirement was justified because POM was “flout[ing] the law”. Id. at *715. The Court rejected this argument stating:

The evidence upon which Complaint Counsel relies, even if true, indicates a disagreement between the Respondents and regulatory authorities regarding whether Respondents’ advertising made disease claims and if so, whether those claims were adequately substantiated. The disagreement with the FTC culminated in this litigation, in which neither side’s position, as to the claims made or the adequacy of the substantiation has been totally vindicated. Under these circumstances, Respondents’ choice not to “heed warnings” and instead to litigate is not fairly interpreted as a willingness to “flout the law” but could be interpreted as an allowable choice made within the system as it exists.
Id. at 715-16.

The Court recognized that a “prior review” requirement raised First Amended issues, but because the Court rejected FTC’s request, the Court did not meaningfully address the First Amendment issue.

Since the enactment of the Dietary Supplement Health Safety Act in 1994, dietary supplements have resided in an uncomfortable regulatory world between foods, which is how they are regulated, and drugs, which is how they are prosecuted. The Court recognized that “individuals could benefit from truthful claims about a product’s ability to treat, prevent, or reduce the risk of diseases or medical conditions...” In re POM Wonderful LLC, No. 9344, 2012 FTC LEXIS 106, at *558 (May 17, 2012). However, whether product claims “cross the line” remains a fact intensive inquiry where health claims that products “treat disease” that are not “supported by sufficient scientific evidence” are “false and misleading” under the FTC Act.

The Judge’s Initial Decision is subject to review by the full Federal Trade Commission on its own motion, or at the request of any party and will become the “decision of the Commission” unless a party files a timely notice of appeal.

FDA Compliance and Social Media – Data Smog, Digital Strangers and FDA’s Road Not Taken

Michael A. Walsh — Tue, 10 Apr 2012 00:00:00 -0500

The Internet revolutionized how we obtain information, and social media has revolutionized how we share it. Yet the current regulatory landscape created by the Food and Drug Administration (FDA) for medical product manufacturers is comprised of rules designed for old media, wherein a medical product manufacturer’s on-line speech and active participation in the dissemination of truthful product information creates an enormous risk of civil and criminal prosecution. The lack of clear regulatory guidance constrains manufacturers from providing meaningful and reliable product information.

For medical product manufacturers, three questions arise concerning their use of the Internet and social media: (1) what can they say?; (2) what are they responsible for (i.e., third-party content and adverse event reporting)?; and (3) what are the consequences of not participating?

In 2009, approximately 158 million users looked online for health information, and 50 million people used the Internet as their first source for health care information. (Click here to view the original research findings.) In the last quarter of 2007 alone, there were “4.6 billion health-related searches across all search engines in the U.S.” (Click here to view the presentation written by Google's Health division.) As patients are increasingly managing their healthcare online, social media are quickly surpassing television and print media as the primary source of health-related information.

Overwhelmingly, consumer health-related searches are driven by medical events, with users looking for a “truth-risk value proposition,” and “personal experience” where two-thirds of them say online information has improved the physician-patient dialogue. Id. at 418 (statements of Larry Mickelberg). Patients are not the only ones managing health information online. According to survey data, 90 percent of physicians are online, and 75 percent are online daily. Physicians no longer simply rely on professional society meetings, journals, sales representatives, and interactions with colleagues in hospital hallways to gain information. Now, this exchange of information is being conducted on a grand scale online.

Consumers and healthcare professionals are not changing how they think because of social media – rather, social media is adapting to work the way people think. Health-related communities are forming and evolving, making interactions more productive, informative, and immediate.
In 1996, FDA held hearings to address the then newly-forming Internet, which was capable of delivering health information without the time limitations of TV or the space limitations of print media. Since 1996, the Internet has become the primary choice of both consumers and health care professionals seeking health and medical product information.

Thirteen years later, in November 2009, FDA held additional hearings regarding the use of the Internet and social media by manufacturers of FDA-regulated products. In connection with those hearings, FDA stated that “[p]olicy and guidance development for promotion of FDA-regulated medical products using the Internet and social media tools are among our highest priorities.” Among the date presented to FDA at those hearings included:

Manufacturers should correct third-party content survey data reflected that 59 percent of the public agree
- “companies are big enough and have enough money to make sure the Internet is accurate.”
- “End the culture of fear” – reverse the “see no evil hear no evil” approach to avoiding Federal enforcement

Since that time, and despite being “among [FDA’s] highest priorities,” FDA has done little to update the regulatory landscape to (1) allow manufacturers to disseminate truthful health-related information regarding its products or (2) provide guidance on what, if anything, a manufacturer must do to monitor third-party information concerning its products.

In December 2011, FDA issued its draft Guidance on Unsolicited Requests, which addressed new media but provided minimal guidance in this regard. Also in December 2011, FDA posted two notices: (1) Examination of On-Line Direct-to-Consumer Drug Promotion, which is an effort designed to conduct a series of studies to determine how best to present risk and benefit information on branded drug websites; and (2) Communications and Activities Related to Off-Label Uses of Marketed Products and Use of Products not Yet Legally Marketed (i.e., Scientific Exchange). While these current initiatives may bear on the use of the Internet and social media by manufacturers of FDA-regulated products, it is uncertain when, or if, FDA will take meaningful action. Because FDA cannot regulate the online communications or content of the consuming public or healthcare professionals, “the vacuum created by the absence of manufacturer activity within the social media ecosystem has been quickly filled by…user-generated [content].” FDA is fidgeting on the sidelines, confounded by how to fashion new rules to allow its most potent participant, the manufacturer, to participate meaningfully.

This regulatory void hinders the most potent source of reliable health information specific to medical products, both for consumers and healthcare professionals.

Industry should be an active participant in any dialogue concerning its products. But fear of FDA’s criminal and civil enforcement and penalties has led the industry to take the FDA’s threats seriously and manufacturers anxiously sit as bystanders. Rather than permitting industry to step in, (no matter how imperfectly), to inject truthful, reliable, scientific information, the regulations instead restrict participation and punish missteps. (See, for example, the 14 Notices of Violation issued by FDA on April 2, 2009 claiming “misbranding” (a crime under the FDCA) where risk information was a scroll or click away.

While FDA’s concern for “fair balance” in presenting risk and benefit information may intuitively seem to promote the public health, a recent study surveyed 20 years of literature on the impact of FDA risk communications on health care utilization that suggests that injecting too much risk data can be as harmful as providing no risk data at all:

“[U]nintended consequences from regulatory warnings…demonstrate[] the challenge that [FDA] face[s] to design risk messages…that don’t become risks themselves.” Dusetzina SB, et al. Impact of FDA Drug Risk Communications on Health Care Utilization and Health Behaviors: A Systematic Review, Med Care, Jan. 18, 2012.

While consumers expect manufacturers to not only know what is being said about their products online but also to provide useful information, consumers are unaware that manufacturers are constrained from meaningfully participating in the online dialogue. The absence of reliable product information results in the public trusting “digital strangers” to provide important health care information and further fosters the public’s distrust of manufacturers.

As FDA ponders its options, the Internet has morphed into a platform for personal interaction regarding health care issues on a global scale. With no new guidance from FDA in sight, industry is left with rules designed for old world media that restrict and severely punish “incorrect” participation, where both the public and manufacturers must read tea leaves when navigating their way through online health information.

Because the electronic communication frontier cannot be contained, FDA will eventually pave the way and establish rules to allow those who know the most about their health care products to provide truthful, reliable information to those who have a real and immediate need for it. The scope and tools for social media are changing more quickly than FDA can act, and the resulting absence of manufacturer presence in social media may represent a lost opportunity to an entire generation of Americans for advancement in providing important health information.

To view the extended version of this blog post written for the Defense Research Institute, click here.

Fifth Circuit Delivers Knockout Punch to Drug Claims

Michael A. Walsh — Tue, 03 Apr 2012 00:00:00 -0500

Under Texas law, a products liability action involving a “medicine” has a statutory rebuttable presumption that the “health care provider, manufacturer, distributor, and prescriber” are not liable if the warnings or information that accompanied the product were approved by the Food and Drug Administration (FDA). See Tex. Civ. Prac. & Rem. § 82.007(a)(1). The statute provides five grounds for rebutting this presumption, including “Fraud-on-the-FDA” – the defendant withheld from or misrepresented to the FDA (i) “required information” that was (ii) material and relevant to the performance of the product and (iii) causally related to the claimant's injury. See Tex. Civ. Prac. & Rem. § 82.007(b)(1).

On February 22, 2012, in Lofton v. McNeil, the Fifth Circuit significantly limited plaintiffs’ ability to use Fraud-on-the-FDA to rebut the no liability presumption under Texas law, finding the claims preempted under federal law.

In June 2000, Mr. Lofton died from Toxic Epidermal Necrolysis (“TEN”), allegedly resulting from ingesting ibuprofen. Plaintiffs claimed the manufacturers failed to warn consumers about the risk of severe autoimmune allergic reactions and asserted common law negligence and strict products liability claims. The manufacturers moved for summary judgment on all claims, asserting that the failure to warn claims require proof of Fraud-on-the-FDA and are preempted under Buckman Co. v. Plaintiffs’ Legal Comm., 531 U.S. 341, 121 S. Ct. 1012 (2001).

In Buckman, the Supreme Court rejected a private right to bring an action sounding in Fraud-on-the-FDA because the state law claim would “conflict with the FDA’s responsibility to police fraud consistently with the Administration’s judgment and objectives.” 531 U.S. at 350. The Court stated “that the federal statutory scheme amply empowers the FDA to punish and deter fraud against the Administration.” Id. at 348. Not only does federal law provide administrative tools to punish and deter fraud, but the agency’s decision to employ those tools implicates its discretion and special competence. Among the factors that make FDA enforcement a somewhat delicate balance of statutory objectives are the need for administrative efficiency and the possibility that tort liability based on inadequate disclosures would create an incentive to submit a deluge of information. Id. at 351. The Court concluded that authorizing tort liability for failure to comply with FDA disclosure requirements “would exert an extraneous pull on the scheme established by Congress, and it is therefore pre-empted by that scheme.” Id. at 353.

The Lofton district court found that the § 82.007(a)(1) presumption of no liability applied, because the manufacturer complied with all FDA requirements governing the labels. Lofton v. McNeil, 682 F. Supp. 2d 662 (N.D. Tex. 2010). The court considered the plaintiffs’ attempt to rebut that presumption based on § 82.007(b)(1) but entered summary judgment for the manufacturers finding that a claim of Fraud-on-the-FDA is preempted unless the claimant can demonstrate that the FDA itself found fraud and further “extending the holding of Buckman to fraud-on-the-FDA exceptions is warranted.” See id. at 675.

The Fifth Circuit reviewed whether the district court correctly found that federal law preempted § 82.007(b)(1) of the Texas Civil Practice and Remedies Code. The Fifth Circuit considered conflicting opinions interpreting Buckman in the Sixth Circuit (finding preemption) and Second Circuit (not finding preemption) involving virtually identical circumstances. The Sixth Circuit found preemption “unless the FDA itself finds that fraud has been committed during the approval process.” Garcia v. Wyeth-Ayerst Labs, 385 F.3d 961, 966 (6th Cir. 2004). The Sixth Circuit did find that where the FDA itself finds fraud, the state claim could proceed.

The Second Circuit disagreed, finding the traditional “presumption against preemption” applied, finding it embodies a state’s regulation of health and safety where the presumption “stands at its strongest.” Desiano v. Warner-Lambert & Co., 467 F.3d 85, 94 (2d Cir. 2006). The Second Circuit did not view the statute as an attempt to police fraud-on-the-FDA but instead as a prerequisite to allowing victims to recover under existing state product liability laws. The underlying claims were held to be traditional product liability claims that didn’t involve a “newly-concocted duty” between the manufacturer and the federal agency. Id. at 94-95. The Second Circuit further held the statute created an affirmative defense available to drug manufacturers but did not render fraud-on-the-FDA an “element” of the plaintiff’s claims, and that there was little likelihood of a conflict with FDA’s approval process that would inflict a deluge of unnecessary information on the agency, as the Supreme Court feared in Buckman.

The Fifth Circuit noted well-established Supreme Court precedent, stating that a preemption inquiry “start[s] with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.” Hillsborough Cnty., Fla. v. Automated Med. Labs., Inc., 471 U.S. 707, 715, 105 S. Ct. 2371, 2376 (1985) (internal citations omitted). The court further noted that the primacy of the state’s police powers is not universal: “the relationship between a federal agency and the entity it regulates is inherently federal in character because the relationship originates from, is governed by, and terminates according to federal law.” Buckman, 531 U.S. at 347, 121 S. Ct. at 1017. Interestingly, Buckman squarely declined to apply a presumption against preemption of a state law claim for fraud-on-the-FDA, as the Court reasoned that federal law dictates which information the manufacturer is obliged to disclose and imposes penalties for omissions and misrepresentations. 531 U.S. at 347-48. As a result, disclosures to the FDA are “uniquely federal” and thus beyond the states’ traditional police power, and state laws that depend on such disclosures are not entitled to a presumption against preemption. Id.

The Fifth Circuit concluded that although the Supreme Court has interpreted the Supremacy Clause to permit some parallel state law tort suits, Lofton did not raise that issue. The Fifth Circuit was further unpersuaded that § 82.007(b)(1) “is merely a legislative means to produce some evidence” of fraud on the FDA to counter the insulation from liability otherwise afforded by § 82.007(a)(1).

What remains of failure to warn claims regarding medicines in the State of Texas?
The Plaintiffs argued for the first time on appeal that § 82.007(b)(1) is not severable from § 82.007(a) but the Fifth Circuit refused to consider the issue holding that the court has a “virtually universal practice of refusing to address matters raised for the first time on appeal.” Karl Rove & Co. v. Thornburgh, 39 F.3d 1273, 1280 (5th Cir. 1994).

Under 82.007(b) there are five (5) grounds for rebutting the presumption of no liability involving FDA approved products under Texas law:

(1) “Fraud-on-the-FDA” - After Lofton, a showing that FDA found fraud will be required;
(2) “Sale after product recall” - the pharmaceutical product was sold or prescribed after an order of the FDA removing the product from the market or withdrawing its FDA approval of the product;
(3) “Off-Label Promotion” - the product was used and the injury caused by an “unapproved use” “recommended, promoted, or advertised” by the defendant;
(4) “Off-Label Prescription” - the product was used and the injury caused by an “unapproved use” “prescribed” by the defendant; or
(5) “Bribery” –the defendant bribed an official causing the FDA approved warnings or instructions to be inadequate.

While it is not clear which of these approaches, if any, will next take center stage, what is clear is that federal courts in Texas will be hard-pressed not to dismiss failure to warn claims where Plaintiffs claim fraud on the FDA.

Par Vs. USA - Off-Label Promotion and the First Amendment

Michael Walsh — Mon, 13 Feb 2012 00:00:00 -0500

Playing the Back 9 - FDA may need to take a Mulligan (or two) in its definition of off-label promotion

More than ten years after the District Court in DC invalidated FDA regulations concerning promotional activities as violative of the First Amendment to the US Constitution in Washington Legal Foundation v. Henney, and as the judge who presided over that case predicted, the First Amendment challenge to FDA regulations prohibiting truthful and non-misleading speech has resurfaced.

In Par Pharmaceutical, Inc. et al v US, Par brought suit for declaratory relief in the District of Columbia to prohibit FDA from, among other things, enforcing “FDA’s unconstitutional and invalid regulations” restricting truthful non-misleading speech. Par’s complaint seeks declaratory and injunctive relief concerning the following:

1. FDA’s intended use regulations “as applied” violate the first Amendment by prohibiting truthful non-misleading “on-label” speech.

2. FDA cannot “deem intent” to market off-label based on knowledge that a manufacturer knows that physicians are using a product off-label.

3. To the extent on-label speech is “deemed” to relate to an off-label use, declare that FDA’s regulations violate the First Amendment to the extent they prohibit truthful and non-misleading speech concerning off-label use.

4. To the extent on-label speech is “deemed” to relate to an off-label use, declare FDA’s definition of labeling violates the First Amendment “as applied” to prohibit truthful non-misleading speech concerning off-label use.

5. 32 CFR 201.100(c)(1) is invalid as contrary to 21 USC §353(b)(2).

6. FDA’s definition of labeling 21 CFR § 201.1(1)(2) is invalid as contrary to 21 USC § 321(m).

7. Enter a preliminary injunction during the pendency of this case prohibiting enforcement of the foregoing regulations.

8. Enter a permanent injunction to prevent enforcement of invalid regulations to prohibit truthful and non-misleading speech.

9. Request for costs and attorneys’ fees.

In seeking to dismiss this case, FDA argues that the claims are not ripe and has submitted the declaration of the Associate Director of Medical Policy and Director of the Office of Medical Policy (OMP) at the Center for Drug Evaluation and Research (CDER) at FDA. At this juncture in the case, FDA is not yet tackling Par’s First Amendment challenge but is attacking what it perceives as false assumptions and misinterpretations of the marketing regulations. FDA’s Declaration starts off recognizing that an off-label use may constitute the medical standard of care and that manufacturers possess superior information concerning their products stating:

“FDA recognizes that some off-label uses or treatment regimens may be important therapeutic options and may even constitute a medically recognized standard of care. FDA further recognizes that scientific or medical departments within drug firms often maintain a large body of information about their products, which may include off-label information for their products. FDA acknowledges that off-label information may be of use to physicians seeking information about a medical product for their patients. (Declaration at para 12).

There is no law, regulation or guidance that details the contours of permissible conduct with respect to truthful and non-misleading communications concerning off label use of an FDA approved drug or device and, in its Declaration, FDA purports to “describe... FDA’s procedures and policies with respect to the communication of promotional information about off-label uses.” To the extent FDA’s procedures and policies are stated, they are stated like a riddle, not stating specifically what is permitted, instead stating what it is not permissible and injecting the following confounding phrase: “by itself.” With that background, FDA explains its policies and procedures as follows:

FDA does not consider a manufacturer’s truthful and non-misleading speech to healthcare professionals concerning the approved use of an FDA-approved drug as establishing, by itself, a manufacturer’s objective intent that the drug be used for an unapproved use. (para 14)

Nor does FDA regard a manufacturer’s knowledge that an FDA-approved drug was being prescribed by healthcare professionals for an unapproved use as establishing, by itself, a manufacturer’s objective intent that the drug be used for an unapproved use.

Thus, wrongful and illegal conduct can be proven, in part, by truthful and non misleading speech and knowledge that a product is being used by the medical profession for an unapproved use. This evidence is not per se, “by itself,” sufficient evidence of criminal conduct, but it is evidence nonetheless of illegal intent; such as having explosive material would not, by itself, be evidence of intent to cause an explosion, but also possessing the triggering materials might be evidence of illegal intent. The phrase “by itself” is not defined under the Act, in the regulations or in Guidance documents and is understood to have its ordinary meaning (i.e. per se, or unconnected to other matters). Yet, the examples FDA provides would not exist in a vacuum, unconnected to other “circumstances,” events or facts (i.e. “by itself”) and it remains unclear what will render conduct and surrounding circumstances actionable.

FDA sheds dim light on what evidence will suffice to render “truthful speech” or knowledge of facts illegal stating: “determining …the manufacturer’s ‘objective intent,’… can be based on …the circumstances surrounding the drug’s distribution… and may include “additional evidence suggesting…a deliberate strategy to encourage off-label prescribing.” (Declaration at 13 and 15). Despite purporting to provide detail, none is given and it remains unclear what constitutes “additional evidence” and whether additional “by itself” (i.e. truthful speech or knowledge of additional facts) conduct will expose a manufacturer to civil and criminal liability.

There is no doubt of FDA’s zeal in protecting the public from products that are either unsafe or not efficacious, but in light of the articulation of the “policies and procedures” set forth by FDA in this case as well as its intransigence on this issue, the First Amendment issues raised in Par, and a growing number of other cases, may not be resolved any time soon. In the meantime, as discovery proceedings get underway in Par, uncertainty continues concerning the dissemination of truthful and non-misleading information regarding unapproved uses for FDA regulated products.

The Time to Track "Transfer of Value" is Approaching: Manufacturers of Drugs, Devices, Biologics and Medical Supplies Must Soon Report Payment to Health Care Providers

Cassia Ysaguirre — Wed, 25 Jan 2012 00:00:00 -0500

In an effort to ensure transparency in the relationships between manufacturers and distributors of pharmaceuticals, biologics, medical devices, and medical supplies, the Patient Protection and Affordable Care Act of 2009 (the “Health Reform Law”) requires Manufacturers to report payments or other transfers of value in the 2012 calendar year to physicians and teaching hospitals in electronic format by March 31, 2013, and on the 90th day following each calendar year thereafter. For a detailed discussion of the reporting requirements, see the recent Strasburger Health Industry Online newsletter Manufacturers Must Soon Track and Report Payments to Health Care Profressionals: Are You Prepared? On December 14, 2011, the Centers for Medicare and Medicaid Services (“CMS”) issued a Proposed Rule in which it proposes to delay the data collection by Manufacturers until the Final Rule is issued sometime later in 2012. Depending on the timing of the issuance of the Final Rule, CMS has proposed that Manufacturers submit only a partial year report on March 31, 2013. CMS posed several questions in the Proposed Rule and invited public comment. The comment period is open until February 17, 2012.

FDA’s Draft Guidance regarding Off-Label Promotion - The Holy Grail of Truthful Information?

Michael A. Walsh — Wed, 18 Jan 2012 00:00:00 -0500

Over decades, billions of dollars in penalties have poured into government coffers based on alleged off-label promotion of drugs and devices. More than enough time has passed, and litigation has occurred, for Congress to realize that many good, well-intentioned companies and individuals do not see a clear path forward regarding the communication of truthful scientific information. Yet Congress has continued to ignore this lack of clarity and, instead, lets FDA, industry and the consuming public wallow in a murky fog.

Whether FDA’s numerous initiatives addressed to the issue of off-label and New Uses, as well as those initiated by industry, will bring long needed certainty to this perilous area is not known but, by current count there are five important efforts underway concerning Off-Label/New Uses:

1. Draft Guidance for Industry: Responding to Unsolicited Requests for Off-Label Information about Prescription Drugs and Medical Devices, issued on December 27, 2011;

2. Scientific Exchange: FDA’s December 28, 2011 Notice and request for Comments concerning “Communications and Activities related to Off-Label Uses of Marketed Products and Products Not yet legally marketed”(FR Vol. 76, no. 249; 81508);

3. FDA’s Guidance on the “Promotion of FDA – Regulated Medical Products Using the Internet and Social Media Tools.” A two day hearing was held on Nov. 12-13, 2009;

4. Citizen Petition filed by seven (7) major product manufacturers requesting FDA clarify policies regarding off-label and new uses (including products not marketed);

5. A number of actions asserting First Amendment challenges to current regulations.

Responding to Unsolicited requests for Off-Label Information About Prescription Drugs and Medical Devices

The Background provided by FDA in this Draft Guidance brilliantly sets the stage for a breakthrough in thinking regarding public requests. The Guidance begins by reminding the reader of the following:

[H]ealth care professionals can lawfully use or prescribe that product for uses or treatment indications that are not included in the product's approved labeling. FDA recognizes that these off-label uses or treatment regimens may be important therapeutic options and may even constitute a medically recognized standard of care…. [S]uch information may also be of use to individuals seeking information about a medical product for themselves, patients, family members, or friends.

While FDA still has not issued its “guidance” on electronic and social media, it does begin to thoughtfully recognize the new world of information on the internet in connection with testimonials, blogs (including tweets and similar social media) and unknown emerging media:

The rapid growth of the Internet, including social media tools and other emerging technologies, has made it easier for both consumers and health care professionals to quickly seek information about medical conditions and treatments.

FDA recognizes that it can be in the best interest of public health for a firm to respond to unsolicited requests for information about off-label uses of the firm’s products that are addressed to a public forum, as other participants in the forum who offer responses may not provide or have access to the most accurate and up-to-date information about the firm’s products.

[T]he Internet has revolutionized communication, information-sharing, information exchange among systems, and collaboration, enabling consumers to become more proactive about their health and safety. Consequently, the Internet has become a widely used medium for manufacturers and distributors of FDA-regulated medical products to disseminate information. The Internet has also spawned a variety of social media tools that host online content primarily created and published by users…[and] [i]n some cases, this online content may not be accurate.

[As] consumers increasingly use the Internet to search for information about medical conditions and treatments, firms may receive public requests for off-label information about their products through, for example, product websites, discussion boards, chat rooms, or other public electronic forums that they maintain and over which they have full control.

[I]t can be in the best interest of public health for a firm to respond to unsolicited requests for information about off-label uses of the firm’s products that are made in public forums.

FDA is concerned that firms may post detailed public online responses to questions about off-label uses of their products in such a way that they are communicating unapproved or uncleared use information about FDA-regulated medical products to individuals who have not requested such information. In this circumstance, communications to persons who have not requested information may promote a product for a use or condition for which FDA has not approved or cleared.

With this important background and context in mind, perhaps the best articulation of how to view this issue is to use the words of the Commissioner herself: “We must look forward to a new paradigm of scientific efforts to support innovation and medical progress.” Hamburg, Comm. FDA, Innovation, Regulation and the FDA, NEJM 2010; 363:2228-2232 (Dec. 2, 2012).Yet, the Guidance does not forge any new ground but, instead seems to retreat, perhaps leaving the heavy lifting on this important issue to future Guidance in connection with Scientific Exchange. However, the limited public responses allowed to public unsolicited requests fails to take into account how the public at large can be adversely impacted by the lack of truthful information available online regarding drugs and devices.

Unsolicited Requests

The Draft Guidance defines unsolicited requests as “those initiated by persons or entities that are completely independent of the relevant firm.” Private unsolicited requests are those that are directed privately to a firm using a one-on-one communication approach. Public unsolicited requests include those made in a public forum, whether directed to a firm specifically or to a forum at large.

A. Responding to Private Unsolicited Requests

FDA’s policy regarding responding to unsolicited requests was first articulated in a letter to industry in 1982 (See Position on the Concept of Solicited and Unsolicited Requests (April 22, 1982)) and additional guidance was provided over a decade later, when it was stated that manufacturers may respond to unsolicited requests for information with "responsive, nonpromotional, balanced scientific information, which may include information on unapproved uses, without subjecting their products to regulation based on the information." 59 Fed. Reg. 59820, 59823 (November 18, 1994).
FDA’s views expressed in the Draft Guidance remain consistent with these past policy statements as they pertain to private requests. FDA makes the following recommendations to a firm that is responding to a private request “specifically directed to the firm privately through a one-on-one communication”:

1. Information distributed in response to an unsolicited request should be provided only to the individual making the request directly to the firm as a private, one-on-one communication.

2. Information distributed … should be tailored to answer only the specific question(s) asked.

A firm should ensure that all pertinent background data are obtained to be able to determine what information is being requested before providing a response. If an unsolicited question is broad in nature, the firm should appropriately narrow the question. In other words, the level of specificity of the question posed is important to ensure that the firm’s response is tailored to the request.

FDA further expects disclosure of “information about known or suspected risks associated with other diseases or conditions that is also relevant to the disease or condition for which information was requested… to ensure a complete and accurate presentation of the risk issues associated with the requested use…”

3. Information distributed in response to an unsolicited request should be truthful, non-misleading, accurate, and balanced.

[A] firm should disseminate representative publications that reach contrary or different conclusions regarding the use at issue. The response should include complete copies of scientific reprints, technical literature, or other scientific and medical information responsive to the request, not just summary documents or abstracts prepared by the firm.

[T]o the greatest extent possible, a firm should rely on published peer-reviewed journal articles, medical texts, or data derived from independent sources.

Summaries are acceptable but must be accompanied by complete information, both positive and negative.

4. Information distributed in response to an unsolicited request should be scientific in nature.

FDA explains this as suggesting “a firm should respond with material that is scientific in tone and presentation.” However, both “tone” and “presentation” are undefined, leaving firms open to potential criminal and civil liability.

5. Responses to unsolicited requests for information should be generated by medical or scientific personnel independent from sales or marketing departments.

FDA recommends that sales and marketing personnel have no input on the content of responses to unsolicited questions or requests for off-label information.
Instead, FDA recommends that questions or requests about off-label uses be referred to the firm’s medical or scientific representative with specialized background and training in (A) narrowing the questions; (B) tailoring the response only to the specific questions being asked; (C) providing unbiased responses; and (D) documenting the response.

6. Information distributed in response to an unsolicited request should be accompanied by the following:

• the FDA-required labeling,
• “A prominent statement…notifying the recipient that FDA has not approved or cleared the product as safe and effective” for the considered use
• A prominent statement disclosing the indication(s) for which FDA has approved or cleared the product
• A prominent statement providing all important safety information including, if applicable, any boxed warning for the product
• A complete list of references for all of the information disseminated in the response (e.g., a bibliography of publications in peer-reviewed medical journals or in medical or scientific texts; citations for data on file, for summary documents, or for abstracts)

7. A firm should maintain the following records:

• The nature of the request for information, including the name, address, and affiliation of the requestor
• Records regarding the information provided to the requestor
• Any follow-up inquiries or questions from the requestor

B. Responding to Public Unsolicited Requests
FDA then makes the following recommendations to firms responding to public unsolicited requests for off-label information about its product(s), including those encountered through emerging electronic media:

1. A firm should respond only to requests pertaining “specifically to its own named product.”

2. The firm’s response “should be limited to providing the firm’s contact information and should not include any off-label information.” In other words, the firm should answer with a non-answer:

The firm’s public response should convey that the question pertains to an unapproved or uncleared use of the product and state that individuals can contact the medical/scientific representative or medical affairs department with the specific unsolicited request to obtain more information.

The firm’s public response should provide specific contact information for the medical or scientific personnel or department (e.g., e-mail address, telephone number, and facsimile) so that individuals can follow up independently with the firm to obtain specific information about the off-label use of the product through a non-public, one-on-one communication.

After an individual has privately contacted a firm for more information regarding an off-label use of the firm’s product, the firm should provide a detailed response and maintain records … for non-public requests. Therefore, any substantive communication about off-label uses for the product, in response to the original unsolicited off-label question, should occur solely between the firm and the individual who made the request. Regardless of the fact that the original, unsolicited off-label question may have been available to a very broad audience, the firm should not make its detailed response with off-label information publicly available within the same forum...

3. “Representatives who provide public responses to unsolicited requests for off-label information should clearly disclose their involvement with a particular firm.”

FDA recommends that a representative who responds to a public request clearly disclose in his/her public response that he/she is a particular firm’s representative and inform the requestor of the name of the firm representative or department to contact should the individual choose to follow up directly with the firm in a non-public forum for detailed information about the unsolicited request for off-label information.

4. “Public responses to public unsolicited requests for off-label information described in numbers 2 and 3 should not be promotional in nature or tone.”

In addition to a firm’s contact and disclosure information, a public response should include a mechanism for providing readily accessible current FDA-required labeling, if any, for the product (e.g., FDA-approved package insert and, if the response is for a consumer, FDA-approved patient labeling or, for new animal drugs, FDA-approved client information sheet). The public response should not provide any promotional information. For example, a public online response should include a direct link to the current FDA-required labeling, if any, but should not include links to any other information (e.g., product websites, product promotional materials, firm websites, and third-party websites). Furthermore, the uniform resource locator (URL) or web address where viewers are directed to obtain the FDA-required labeling, if any, should not itself be promotional in tone or content (e.g., should not be www.bestcancercure.com).

If a firm responds to public unsolicited requests for off-label information, including those encountered through emerging electronic media, in the manner described above, FDA does not intend to use such responses as evidence of the firm’s intent that its product be used for an unapproved or uncleared use. Such responses also would not be expected to comply with the disclosure requirements related to promotional labeling and advertising.

Simply put, the Draft Guidance allows no public response to an unsolicited request for information concerning off-label uses of FDA-approved products. Instead, only a disclaimer and disclosure, leading to a private response, are condoned. This Draft Guidance is an old world approach to a new world problem of publicly shared information that at times may be incorrect and misleading. Little solace is offered to those who risk the “Gorge of Eternal Peril” in their quest to disclose the Holy Grail of truthful information concerning off-label uses.

To read Mike Walsh's full commentary on this topic via JD Supra, click here.

Golan v Holder: How Many Supreme Court Justices Does It Take To Remove Crayons From The Free Speech Crayon Box?

Michael Walsh — Mon, 14 Nov 2011 00:00:00 -0500

If you think this case is about Shostakovich or Stravinsky, think again. At issue in Golan v Holder No. 10-545, 131 S.Ct. 1600, writ of certiorari granted March 7, 2011, is whether Congress can remove works from the public domain.

The public domain is the “marketplace of ideas” and wellspring of expression. Once in the public domain, works are as freely useable as though they were facts, and “[f]acts, after all, are the beginning point for much of the speech that is most essential to advance human knowledge and to conduct human affairs.” Sorrell v. IMS Health Inc., 131 S. Ct. 2653, 2667 (2011). The public domain contains source material for First Amendment speech and expression that is responsible for advances in art, literature, medicine, science and virtually all forms of human endeavors. At issue in Golan v Holder is whether Congress can take away what the Constitution has granted, and the question is now in the hands of an ideologically divided Supreme Court.

Copyright is a constitutionally protected right that allows an innovator to protect the expression of a work for a limited time. Congress sets the rules by which an innovator can either take steps to protect a work or permit a work to be freely used in the public domain. But the Constitution does not grant Congress the power to remove content from the public domain, and battle lines were drawn when Congress tinkered with the public domain and granted copyright protection to works that had been freely used in the U.S. for generations.

In 1988, the U.S. became a participant in the Berne Convention. Congress did not, however, codify Article 18 of the Berne Convention which required signatory nations to give copyright protection to the works of other Berne members that had not “fallen into the public domain in the country of origin.” On December 8, 1994, Congress codified section 514 of the Uruguay Round Agreement Act (the “URAA”), adopting international standards under the Berne Convention for reciprocal copyright protection (17 U.S.C. 104A and 109(a)), and extending US copyright protection to works that had been in the public domain in the US.

In 2001, in Golan v Ashcroft, conductors, educators, artists, producers and publishers brought suit in the District Court in Colorado seeking a judgment declaring unconstitutional the laws that codified Section 514 of the Uruguay Round Agreements. The case, now Golan v. Holder, was argued before the Supreme Court on October 5, 2011. By that time, it had attracted a large number of interested parties, with 15 separate briefs filed on behalf of a large variety of individuals, professional organizations and associations, including composers, conductors, publishers, authors, artists and libraries.

The Copyright Clause: Article I, Section 8, Clause 8 states: “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the Exclusive Right to their respective Writings and Discoveries.”

“[I]t should not be forgotten that the Framers intended copyright itself to be the engine of free expression. By establishing a marketable right to the use of one’s expression, copyright supplies the economic incentive to create and disseminate ideas.” Harper & Row v. Nation Enter., Inc., 471 U.S. 539, 558 (1985). “[C]opyright law celebrates the profit motive, recognizing that the incentive to profit from the exploitation of copyrights will redound to the public benefit by resulting in the proliferation of knowledge.” Eldred v. Ashcroft, 537 U.S. 186, 211 (2003).

The 1790 federal Copyright Act did far more than simply create uniformity among the states by providing protection for works that were not recognized because of differing state law. When the First Congress enacted the Copyright Act, federal law didn’t merely harmonize state law, it usurped it. The government now distorts this history, arguing that Congress has “restored” rights to works in the public domain before and that joining the international agreement is analogous to establishing a national framework. However, following that rationale, enacting the URAA is akin to a new federalism where the laws of foreign nations trump U.S. law for determining whether works are in the public domain. While it is clear that Congress can define what a “limited Time” is under the First Amendment and can prospectively recognize copyright term durations that harmonize foreign law with U.S. law, it is not clear that Congress may look to the laws of foreign nations to pluck works from the public domain.

I got away with it before so it must be ok, right? The government also argued that copyright was extended to works created but not protected during World War I and World War II. What is interesting about this argument is that the Court never reviewed the propriety of Congress extending copyright protection to public domain works after WWI and WWII because it was never challenged. The fact that Congress ran some red lights in the past without getting caught is not a license for Congress to continue violating the law.

The First Amendment: The First Amendment was ratified in 1789 and states: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.” “[T]he right to receive ideas is a necessary predicate to the recipient’s meaningful exercise of his own rights of speech, press, and political freedom.” Bd. Of Educ. v. Pico, 457 U.S. 853, 867 (1982). For the petitioners, Article 18 of the Berne Convention and the URAA, which adopts its terms, remove a massive swath of an intellectual raw material, essential facts, a great didactic that takes shape in free expression of ideas. To the petitioners, “restoration” of copyright “abridges” speech by taking colors from the spectrum, or removing the well from which the next well-tempered clavier may be drawn.

Newsflash: “Speech In Aid Of Pharmaceutical Marketing [is] Protected By The First Amendment.”

Michael Walsh — Fri, 28 Oct 2011 00:00:00 -0500

Is the Supreme Court on a path to legalize truthful off-label communication?

Manufacturers suffer significant civil and criminal penalties when they communicate truthful scientific information concerning off-label use of their products. The Food and Drug Administration (“FDA”) has been successful in defeating First Amendment challenges by arguing that (1) its regulation of communications concerning off-label use of FDA-regulated products is commercial regulation and (2) off-label communications (i.e. speech) are conduct and evidence of intent to misbrand. But a new day is dawning on the First Amendment, and the government’s old arguments may not endure.

In Washington Legal Foundation v Friedman, 13 F. Supp. 2d 51 (D.D.C. 1998), the Court issued an injunction prohibiting FDA and the Department of Health and Human Services from enforcing any regulation, guidance, policy, order or other official action to prohibit, restrict, sanction, or otherwise seek to limit any pharmaceutical or medical device manufacturer from the dissemination of information concerning unapproved uses for its products. After the Fourth Circuit vacated the injunction stating “as a result of the government’s clarification at oral argument, the dispute between the parties has disappeared before our eyes.” Washington Legal Foundation v Henney, 202 F. 3d 331, 334 (D.C Cir. 2000), the case went back to the trial court to enforce whatever was left of the injunction and the trial court stated:

This year, the Court of Appeals was poised to finally galvanize a rule of law in this area. Yet, for whatever reason, the opportunity was spent debating not the U.S. Constitution’s First Amendment, but its Article III case or controversy requirement. In fact, after the Court of Appeals’ opinion, we have even less First Amendment law than before; this is because the Court vacated all of this Court’s previous constitutional rulings on the matter.

As for this Court’s part in the controversy, the Court is confident that it has done its best…[i]t has decided the [Constitutional] issue at least twice, and senses it will be called on to do so again before the controversy is concluded. For now, however, the issue must be given a temporary rest.

Washington Legal v Henney, 128 F. Supp. 2d 11, 15 (D.D.C. 2000).

The “temporary rest” may be coming to an end as off-label speech cases join a rising tide of First Amendment jurisprudence.

In Sorrell v. IMS Health Inc., 564 U.S. _, 131 S. Ct. 2653_(2011), the Supreme Court stated that “[s]peech in aid of pharmaceutical marketing, however, is a form of expression protected by the Free Speech Clause of the First Amendment“:

[t]he First Amendment requires heightened scrutiny whenever the government creates a “regulation of speech because of disagreement with the message it conveys”…. Facts, after all, are the beginning point for much of the speech that is most essential to advance human knowledge and to conduct human affairs. There is thus a strong argument that prescriber-identifying information is speech for First Amendment purposes.

Id at 2666.

The Court went on to state:
Those who seek to censor or burden free expression often assert that disfavored speech has adverse effects. But the “fear that people would make bad decisions if given truthful information” cannot justify content-based burdens on speech. The First Amendment directs us to be especially skeptical of regulations that seek to keep people in the dark for what the government perceives to be their own good. These precepts apply with full force when the audience, in this case prescribing physicians, consists of “sophisticated and experienced consumers.”…That the State finds expression too persuasive does not permit it to quiet the speech or to burden its messengers.

131 S. Ct. at 2670-71.
In U.S. v. Caronia, 576 F. Supp. 2d 385, (E.D.N.Y. 2008), a case pending in the Second Circuit, Mr. Caronia, his employer and others were indicted as a result of a sting operation. Unfortunately for Mr. Caronia, his employer admitted to a conspiracy to misbrand and paid a hefty penalty. In denying Mr. Caronia’s motion to dismiss, the trial court recognized that the Constitutional question at issue remained “unsettled”:

Reduced to its essence, Caronia’s argument is that the government cannot restrict truthful, non-misleading promotion by a pharmaceutical manufacturer (or its employees) to a physician of the off-label uses of an FDA-approved drug…squarely, Caronia’s constitutional attack calls into questions America’s regulatory regime for the approval and marketing of prescription drugs.…[T]he Constitutional issues raised in Caronia’s motion are very much unsettled, not only in the circuit but nationwide…. ”With that the overture ends and the play begins. Enter on stage the essential question – can government satisfy the fourth prong of Central Hudson?” (i.e. the less intrusive means)…. [H]ere, the FDA’s maintaining through the FDCA’s misbranding provisions some control over the off-label promotion of manufacturers does appear essential to maintaining the integrity of the FDA’s new drug approval process…this Court is unable to identify non-speech restrictions that would likely constrain in any effective way manufacturers from circumventing that approval process.

Id. at 393. The case was tried to verdict against Mr. Caronia, and he was convicted on one count of “conspiracy to introduce or deliver for introduction into interstate commerce a drug…that was misbranded.”

Caronia’s appeal has been joined by amici who have battled the First Amendment issue since the days when it was “laughed out of court.” U.S. v. Caputo, 517 F.3d 935, 937 (7th Cir. 2008). Only now, no one is laughing. Before going to the Supreme Court, Sorrell was decided by the Second Circuit. In finding that the Vermont statute at issue in Sorrell infringed on First Amendment rights, the Second Circuit stated: “[t]he statute is therefore clearly aimed at influencing the supply of information, a core First Amendment concern…the First Amendment teaches that courts should assume that truthful commercial information ‘is not in itself harmful.’” 630 F.3d 263, 272 (2d Cir. 2010). The Court went on to conclude that the state could achieve its goals with less restrictive means:

In other words the statute seeks to alter the marketplace of ideas by taking out some truthful information that the state thinks could be used too effectively. The state’s approach to regulating the interaction between detailers and doctors is premised on limiting the information available to physicians as a means of impacting their conduct. This approach is antithetical to a long line of Supreme Court cases stressing that courts must be very skeptical of government efforts to prevent the dissemination of information in order to affect conduct.

Id. at 277-278. Sorrell was not a case directly involving off-label communications but the Court’s reasoning may apply equally in the context of off-label communications.

Detention For Your Products, Your Profits and Possibly You:

Michael Walsh — Fri, 21 Oct 2011 00:00:00 -0500

Compliance with the Food Safety Modernization Act cannot wait until after the Inspectors Arrive

Section 402 of the Food Safety Modernization Act of 2011 (FSMA) granted the Food and Drug Administration “expanded authority” to detain and seize any regulated food determined to be unsafe, adulterated or misbranded, “or otherwise failing to meet the requirements of the food safety law.” On September 30, 2011 the first seizure/detention was ordered at the Dominguez Foods of Washington, Inc. in Zillah, Washington . The detention order covered “all of the food in the facility not in hermetically sealed containers.” On October 17, 2011, a second seizure and detention was made of “various food products stored in a warehouse owned by Chetak Chicago LLC, in Streamwood, Ill.”, collecting “more than 300 samples of materials showing significant unsanitary conditions.”

In addition to FDA’s new seizure and detention powers, FSMA added significant civil penalties (i.e. “not more than $1,000,000 for each offense and every day is considered a separate offense) and expands on the criminal sanctions under the Food Drug and Cosmetic Act. Under prior law, the penalty was up to 1 year in prison. Now if the offense results in serious illness “the person committing the violation shall be imprisoned for not more than 5 years” and 10 years if it results in death. Couple these sanctions with the government’s use of the Park Doctrine in prosecuting “C” suite officers, even when they had no actual knowledge of an offense, and there should be no question that ensuring compliance is the first item on the agenda and certainly compliance can no longer wait until an inspector knocks at the door.

S.1310 The Proposed Dietary Supplement Labeling Act of 2011

Michael Walsh — Wed, 28 Sep 2011 00:00:00 -0500

Picking up where the Food Safety Modernization Act (“FSMA”) left off, under proposed S.1310, Congress is considering requiring dietary supplement manufacturers to notify FDA of all marketed products and within 30 days with respect to all new and reformulated products, identifying the ingredients, labeling, the weight of any proprietary blend, and lot numbers. The Act would also require notification when a product is discontinued. Under this proposed bill, FDA would contract with the Institute of Medicine (“IOM”) to evaluate dietary supplement ingredients and proprietary blends, and FDA would thereafter establish mandatory warning requirements. FDA would consider non-compliance with the registration and warning requirements misbranding under Section 403 of the Food Drug and Cosmetic Act (21 USC § 343) subject to enforcement action. The proposed Act does not specify the enforcement action that would be taken, but misbranding under the FDCA can be subject to criminal prosecution.

Congress long ago set FDA’s mission to “promote the public health by promptly and efficiently reviewing clinical research …[to] protect the public health by ensuring that foods [including dietary supplements] are safe, wholesome, sanitary, and properly labeled…” 21 USC § 393(b)(1) and (2)(A). While expanding FDA with more and increasing responsibility and oversight may make political sense, adding more rules, regulations and governmental oversight will expand the bureaucracy while adding little more than window dressing to an already vigorous regulatory and enforcement regime for dietary supplements. FDA may better and more immediately achieve its mission by expending its limited resources to enforce the current rules and to inform consumers on how to educate themselves about the substances they ingest and to report adverse events (as well as bad actors) to FDA.

YOU CANNOT SUE FOR WHAT THEY CANNOT DO

Michael Walsh — Tue, 12 Jul 2011 00:00:00 -0500

FEDERAL PREEMPTION PROTECTS GENERIC MANUFACTURERS FROM LABELING SUITS

If you were driving your car down the street and a federal marshal blocked traffic and directed traffic the wrong way down a one-way street, should you be subject to a penalty if a state police officer was handing out tickets at the end of the block for going the wrong way? The Supreme Court says no.

A generic manufacturer cannot be sued under state law for something that federal law says it cannot do and in Mensing v Pliva and Demahy v Actavis the US Supreme Court refused to rewrite the law or regulations.

Irrespective of whether Congress intentionally overlooked the issue of generic manufacturer liability for state-law failure-to-warn claims when it enacted the Hatch-Waxman Amendments, the Supreme Court held that because a generic manufacturer’s label must be identical to its brand-name counterpart, it cannot be held liable for failing to unilaterally enhance labels under state law. The Court did not hold that a generic manufacturer is insulated from liability for its products; it simply (and significantly) limited the state law theories that may be pursued.

THE REAL REGULATORY WORLD

The decision recognizes the real regulatory world in which companies have existed for over 25 years. The state law failure-to-warn claims at issue focused on what the companies knew about an alleged increased risk and hinged liability on the company not promptly changing the product labeling or sending letters to doctors telling them of the risk. Previously in Wyeth v. Levine, the Court ruled that lawsuits claiming failure-to-warn against innovators/branded drug manufacturers are not preempted because those manufacturers can change the label to meet the requirements of state law before getting FDA approval. But when it comes to generic drug labeling, current federal law and regulations require generic manufacturers to copy, verbatim, the branded drug label and they may not change their label unless the branded label is changed first.

THE CONSUMING PUBLIC

Congress had to strike a balance between the cost and time involved in getting medications on the market, and the price the consuming public would pay. Prior to 1984, before marketing any medication, all manufacturers were required to establish that a medication was both safe and that they worked. That process was expensive, time consuming, and prices were necessarily high. But in 1984, the Hatch-Waxman Amendments achieved what was touted as an important societal goal of reducing price and increasing availability of important prescription medications to patients who may otherwise go untreated.

ASSUMING TOO MUCH?

Congress accomplished this goal, in part, by eliminating the requirement to undertake the time or resources to prove the generic safe or effective, provided the generic manufacturer markets a generic “equivalent” and copies, verbatim, the branded medication labeling. While Congress could have struck a different balance regarding generic drugs, it chose to rely on the efforts and experience of the branded drug. Perhaps it assumed that a product on the market for years, prior to its generic copy, would have satisfied safety and efficacy requirements through (1) the branded drug approval process and (2) real world experience with doctors treating patients with the branded product. Whether generic prices are too low because Congress struck a poor balance is not for the courts to decide. What was Congress thinking on this issue? It may not have been thinking at all about generic manufacturer liability or state law failure to warn lawsuits, but the Supreme Court did not see fit to right what Congress may have gotten wrong.

THE END OF GENERIC DRUG CLAIMS?

In addition to claims that do not rely on a label change, the FDA filed a brief in this case and recognized a duty for generic manufacturers to propose stronger labeling when the product is “misbranded,” under 21 USC §352(f)(2), where there is a reasonable association of a known hazard 21 CFR 201.57(e). The court stated that, “[a]ccording to the FDA, the Manufacturers could have proposed – indeed, were required to propose – stronger warning labels to the agency if they believed such warnings were needed.” On this point, the Court assumed that such a “duty” existed and stated “[b]ecause we ultimately find preemption even assuming such a duty existed, we do not resolve the matter.” Nonetheless, the Court reasoned that asking the FDA for a label change would not satisfy the state law requirement for a safer warning. It further recognized that the plaintiffs acknowledged their claims were not based on the generic manufacturer failing to ask FDA for a label change. The Court recognized a “novel question” of “whether conflict preemption should take into account these possible actions by FDA and the brand-name manufacturer” in taking steps necessary to change labeling.

IMMEDIATE IMPACT

This is a long awaited decision impacting thousands of currently pending cases and significantly limiting the claims that may be asserted against a generic manufacturer. While the Court recognized that the outcome was “unfortunate” for those with claims against a generic manufacturer based on inadequate labeling, it was not prepared to rewrite the law or regulations stating “[a]s always, Congress and the FDA retain the authority to change the law if they so desire.”

While the holding in this case matters to consumers because, it takes the teeth out of product liability lawsuits; in the final analysis, this opinion may not be as significant because rarely, if ever, does a prescribing physician review the label of a generic manufacturer or even know which manufacturer’s product his patient is ingesting. The full effects of Hatch-Waxman are still being realized and, after Mensing, part of the compromise for lower drug costs is a weakening of the potential state law tort claims consumers can assert against the generic manufacturer of the medications they are taking.