Off-Label Speech After U.S. v. Caronia: Implications for Drug & Device Regulation and the First Amendment, a Washington Legal Foundation Web Seminar program, is now available for on-demand viewing.
Our program featured analysis and commentary from Coleen Klasmeier of the Sidley Austin law firm and WLF’s Chief Counsel, Richard Samp. Coleen and Rich make reference to a Powerpoint slide deck, which due to a technical problem wasn’t available to viewers during the program. The slide deck can be downloaded here.
For her presentation, Coleen coined the term “Sorrellonia” because the U.S. Court of Appeals for the Second Circuit two-judge majority in Caronia became the first court to fully apply the holding and rationale of the U.S. Supreme Court’s 2011 Sorrell v. IMS Health opinion.
Coleen’s and Rich’s presentations drew upon their combined years of experience in dealing with FDA’s application of its off-label speech restrictions and the Justice Department’s prosecution of cases where criminal violations of those rules allegedly occurred.
While they both saw great promise in the opinion for greater freedom in the exchange of critical medical information, they also offered firm notes of caution that the ruling not be interpreted as a green light for businesses’ promotion of off-label uses. Great peril still exists in this area they warned, a fact that is all the more apparent today with the announcement of another nearly $1 billion Justice Department settlement with a pharmaceutical company.
by Kelly Day Savage, Sedgwick LLP*
Many commentators (including this one) correctly predicted that savvy plaintiffs and sympathetic courts would create exceptions to the Supreme Court’s decision in PLIVA, Inc. v. Mensing, 131 S. Ct. 2567 (2011)– that state-law tort claims against manufacturers of generic drugs based on insufficient product warnings are preempted by federal law–to permit plaintiffs to recover damages in otherwise barred actions.
In Whitener v. PLIVA, Inc., No. 10-1552, 2012 WL 3948797, at *4 (E.D. La. Sept. 10, 2012), the Federal District Court for the Eastern District of Louisiana created yet another legal loophole by permitting “a state-law tort claim based on alleged promotion of metoclopramide [the generic version of Reglan] for off-label purposes in violation of federal law” to escape preemption on defendants’ motion to dismiss. Continue reading
Cross-posted at WLF’s Forbes.com Contributor blog
With their law enforcement counterparts at the federal level raking in prodigious financial settlements, it’s no surprise that state attorneys general (“state AGs”) want a bigger piece of the action on off-label drug “promotion” regulation. The $181 million settlement reached August 29 between 36 attorneys general and a drug maker confirmed that state AGs must indeed be reckoned with on off-label issues. What will get medical product companies’ attention is not the financial settlement, though. The real eye-opener was the precision of the settlement’s conduct requirements, most notably one restraint on speech which goes beyond the dictates of federal law.
The settlement arose from “deceptive marketing” suits filed by state AGs throughout the country involving Ripersdal. Some of those suits resulted in verdicts imposing six- or seven-figure damages on the defendant, Janssen Pharmaceuticals. Janssen and its parent company, Johnson & Johnson (J&J), had appealed those verdicts, but the cost-benefit calculus of fighting vs. settling likely led the companies to resolve the claims on a global basis (much like the tobacco companies did with the state AGs).
In addition to the monetary settlement, Janssen and J&J agreed to conditions and limitations on how they share information about Ripersdal with medical professionals. As noted above and emphasized by former FDA associate chief counsel Arnie Fried in a Pharmalot interview, such behavior-changing dictates were what the AGs were really after here. Continue reading
Cross-posted by Forbes.com at WLF’s contributor page
Pharmaceutical companies’ promotions of their products continues to be an area of intense activity for several federal government agencies. Such focused federal attention makes it easy for all interested parties, perhaps including drug makers themselves, to overlook the states’ involvement in the area of pharmaceutical promotion. A settlement last month between the Oregon Department of Justice and Pfizer, which has received very little attention, is a stark reminder that many states are also keenly interested in pharmaceutical promotions.
The March 20, 2012 “Assurance of Voluntary Compliance” document arose out of Oregon’s involvement in a federal investigation of, and eventual settlement with, Pfizer regarding off-label “promotion” and other promotional activities. The September 2009 $2.3 billion settlement stemmed from Pfizer’s promotion of a number of drugs, including painkiller Bextra and Zyvox, an antibiotic.
An Oregon DOJ press release relates that a two-year investigation indicated that Pfizer was relying on “unreliable and unsubstantiated claims” to promote Zyvox as being more effective than a competing product. As the state investigation’s leader noted to a reporter, “Our investigation was aggressive, detailed, went places that the federal settlement didn’t and provided additional settlement to the state of Oregon.” Continue reading
In case you missed it, a video of WLF’s October 26 Web Seminar program, Liability & Exclusion Without Intent: Managing to Survive Under the Responsible Corporate Officer Doctrine, is now available for your on-demand viewing.
The speakers, Mark Calloway and Brian Stimson of Alston & Bird, prepared a PowerPoint presentation to go along with their talk. That presentation is available here.
Constitutional Protection Amidst Severe Civil Punishments, WLF Legal Opinion Letter
“Responsible Corporate Officer”: Business Executives Face Strict Liability Under Novel Criminal Law Doctrine, WLF Legal Backgrounder
As of Monday, August 15, drug companies can no longer bar comments from their Facebook pages. The conversation is now open, and Facebook users can freely comment on drugs, regardless of their knowledge and use of the drug in question.
Ostensibly, this seems fair. Drug companies should play by the same rules as the rest of companies, right? But if drug companies should abide by the same Facebook rules, they should be just as free from government regulation as are other companies whose pages feature third-party wall posts. Unfortunately, this is not the case. Comments on the walls of drug companies can expose drug companies to serious liability with the FDA – liability that could cost hundreds of millions of dollars. Continue reading
A beneficiary of off-label medicine
Cross-posted by Forbes.com at WLF’s contributor page
Texas Governor Rick Perry is the latest beneficiary of so-called off-label medical therapy. Earlier this week, USA Today reported that Perry’s back surgery last month involved a stem cell therapy that is currently approved by the Food and Drug Administration (FDA) solely for bone marrow transplants. The procedure went smoothly, however, and Perry’s health is now much improved thanks to his doctor’s knowledge of the therapy’s off-label application.
Unfortunately, off-label success stories like Perry’s are less common than they should be. The reason is simple: drug companies are prohibited from pro-actively sharing information about their products for uses beyond what the FDA has approved. If a drug company discovers that its drug can be used to treat disease X, but it has only been FDA approved for disease Y, the company has to essentially remain mum about its solution to X. Without this useful information, doctors are less likely to know about the drug’s beneficial alternative applications. This ban on off-label communication is an offense to both American patients and American notions of free speech. Continue reading
Oooo, the Claw
Cross-posted by Forbes.com at On the Docket and the WLF contributor page
The Washington Post reported this morning that the Securities and Exchange Commission had rejected a recommendation by the agency’s enforcement division to settle a case SEC had filed against former CSK Auto CEO Maynard Jenkins. This confirms that SEC has joined the federal government’s misguided drive to impose strict vicarious liability on business leaders for the unauthorized, unknown actions of others in their companies.
SEC Clawback. Several CSK officers had been engaged in accounting fraud, violations which an internal audit ordered by Jenkins had discovered. SEC’s case against the officials and the company acknowledged that Jenkins was himself a victim of the fraud, as the perpetrators had actively hidden the illegal activity from him. He was never accused of securities fraud or of even being negligent in his management of the company. Nevertheless, the SEC’s enforcers decided to pursue “reimbursement” of Jenkins’ bonuses under the so-called clawback provision of the Sarbanes-Oxley Act (SOX). Section 304 of the Act allows for this in situations where the company was harmed “as a result of misconduct” by the executive whose bonus return is being sought. Continue reading
Seven large drug companies last week threw up their hands in exasperation and implored the Food and Drug Administration (FDA) to provide them with some meaningful guidance regarding their speech rights. They filed a formal Citizen Petition, asking the agency to spell out what they are permitted to say regarding off-label uses of their products. The Petition noted that FDA has, to date, provided virtually no meaningful guidance, and none is expected any time soon.
Perhaps the most surprising aspect of the Petition is its conciliatory tone. The seven companies might have noted that numerous court decisions – including one issued by the Supreme Court on June 27 – have indicated that the First Amendment places significant restraints on the government’s authority to limit truthful speech by drug companies. Or that FDA is subject to a permanent injunction issued in litigation initiated by Washington Legal Foundation, which limits FDA authority in certain contexts to prevent manufacturers from speaking truthfully about off-label uses of their products. Or that virtually all medical experts agree that widespread dissemination of truthful off-label information is an essential component of effective health care delivery. But the Petition says nothing that might be deemed critical of FDA; it simply asks FDA to tell drug companies what the law is, so that they can adjust their policies accordingly. The companies noted that they risk criminal and civil sanctions if they guess wrong regarding the dividing line between permissible and impermissible manufacturer speech. Continue reading
Last month in a Legal Pulse Post, ”In Off-Label Criminal Case, Judge Pokes Finger at Prosecutors’ Jaundiced Eye“, WLF’s Rich Samp assessed the highlights of Judge Roger Titus’s remarkable mid-trial order acquitting former drug company in-house counsel Laura Stevens of charges that she obstructed justice during a Justice Department investigation of alleged off-label drug “marketing”. Even the judge acknowledged the highly unusual nature of the outcome, stating that he had never previously issued such an order in response to a defendant’s routine motion under Federal Rule of Criminal Procedure 29(b).
This morning, Corporate Counsel magazine’s Sue Reisinger is reporting that the U.S. Attorney for the District of Maryland, where the indictment was brought and the case tried, refused to sign the indictment. It is routine, with almost no exceptions, that the U.S. Attorney from the district where an indictment is brought has his name on the document even if a Justice Department attorney does as well. Reisinger’s story notes that the Maryland U.S. Attorney, Ron Rosenstein, is a highly respected career prosecutor who received unanimous Senate confirmation to the position in 2005.
Mr. Rosenstein’s reason for not signing: He reportedly felt that the evidence against Ms. Stevens was lacking. DOJ regretfully chose not to exercise its prosecutorial discretion as wisely as did Mr. Rosenstein, and plowed forward with the case, bringing in an Assistant U.S. Attorney from Boston to pursue the charges.