Video Commentary Voices Concern Over Unchecked Foreign Corrupt Practices Act Enforcement

Our presenter, Mike Koehler, is a Professor of Business Law at Butler University and editor of the FCPA Professor blog.  Professor Koehler testified on Tuesday, November 30 before a Senate Judiciary subcommittee hearing entitled “Examining Enforcement of the Foreign Corrupt Practices Act”.

Recent Maneuvers Reflect DOJ’s Concern over Pending Off-Label Speech Case

A criminal case against a low-level pharmaceutical employee, charged with improperly promoting an FDA-approved drug for an off-label use, is rapidly developing into a major test case of whether FDA’s efforts to ban truthful speech conflict truthful speech.  This week, the U.S. asked that one of its top appellate advocates be permitted to participate in oral arguments.  

Alfred Caronia is appealing to the Second Circuit in New York from his conviction for promoting the sale of a “misbranded” drug.  The drug in question, Xyrem, is FDA-approved; but FDA contends that any drug should be deemed misbranded if it is being promoted for an off-label use, i.e., a use not approved by FDA.  FDA does not contend, however, that anything said by Caronia was untruthful, and the off-label Xyrem uses of which he spoke have now been approved by FDA (and thus are now part of Xyrem’s amended labeling).

When briefing was completed last month, the Second Circuit initially stated that it would decide the case without oral argument – a strong signal that it was likely to affirm the conviction.  But after reviewing a First Amendment brief submitted by the Washington Legal Foundation in support of Caronia, the court changed its mind and set the case for oral arguments.  Then WLF asked (with the consent of all parties) to be permitted to participate in oral arguments, for the purpose of arguing that FDA violated the First Amendment by seeking to impose criminal sanctions on Caronia for speaking truthfully.

This past week, the United States asked the court that it be permitted to bring in its own reinforcements for oral arguments.  An Assistant U.S. Attorney from Brooklyn was initially scheduled to argue for the prosecution.  But the U.S. has now asked that it be allowed to add Douglas Letter to its roster.  Letter, a veteran attorney in the Department of Justice’s Civil Division in Washington, is considered one of the federal government’s top appellate advocates and a First Amendment expert. 

FDA apparently is beginning to recognize that First Amendment challenges to its authority are being taken seriously by the federal courts.

Last Week At WLF

Litigation Updates:

  • IMS Health Inc. v. Sorrell
    On November 23, 2010, the U.S. Court of Appeals for the Second Circuit reinforced First Amendment rights by striking down a Vermont law that blocks access to critical healthcare information. The law criminalized the collection and disclosure of information about the prescribing practices of physicians. The 2-1 decision was a victory for WLF, which filed a brief urging that the Vermont law be struck down.
  • Johnson & Johnson v. State of West Virginia
    On November 19, 2010, the West Virginia Supreme Court of Appeals overturned a $4.5 million penalty imposed on a drug maker for allegedly misleading statements in communications addressed to doctors. The penalty was imposed despite the absence of evidence that anyone in West Virginia suffered an injury, or that anyone even relied on the communications. The decision was a victory for WLF, which filed a brief urging that the penalty be overturned. WLF argued that the penalty violated the manufacturer’s First Amendment rights.
  • Astra USA, Inc. v. County of Santa Clara
    On November 19, 2010, WLF urged the U.S. Supreme Court not to permit plaintiffs’ lawyers to use U.S. courts as a platform for asserting claims against foreign companies that bear no relation to the United States. The case raises important issues about the continued viability of the Supreme Court’s longstanding protections against the exercise of personal jurisdiction by U.S. courts over foreign corporations. In a brief filed in support of French, Turkish, and Luxembourgian tire manufacturers, WLF argued that their mere introduction of tires into the stream of commerce, standing alone, cannot support North Carolina’s assertion of general jurisdiction over them.

From the Legal Pulse:

Prior Invention — “That which infringes, if later, would anticipate, if earlier” — Prevails in Patent Suit

Guest Commentary

Eric J. Fues, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP*

The United States has a “first to invent” patent system.  This principle is embodied, among other places, in section 102(g)(2) of the Patent Code, which states that a person is not entitled to a patent if “before such person’s invention thereof, the invention was made in this country by another inventor who had not abandoned, suppressed, or concealed it.”  35 U.S.C. § 102(g)(2).  Relying on this provision, the U.S. District Court for the District of Pennsylvania (the “EDPA”) recently invalidated a drug formulation patent, U.S. Patent No. RE39,502 (“the ’502 patent”), due to AstraZeneca’s prior invention.  See Teva Pharm. Indus. v. AstraZeneca Pharms. (E.D. Pa. Oct. 20, 2010) (D.I. 92).

In October 2008, Teva Pharmaceutical Industries Ltd. (“Teva”) sued several AstraZeneca companies for alleged infringement of the ’502 patent.  Teva asserted that its patent covered AstraZeneca’s blockbuster drug product, CRESTOR®.  Teva filed the lawsuit in the EDPA, near the headquarters of its U.S. subsidiary, Teva Pharmaceuticals USA, Inc.  (“Teva USA”).  At the time Teva filed suit, Teva USA was a defendant in a consolidated ANDA case in the U.S. District Court for the District of Delaware for infringement of a patent covering the active ingredient of CRESTOR®. Continue reading “Prior Invention — “That which infringes, if later, would anticipate, if earlier” — Prevails in Patent Suit”

Second Circuit Finds Vermont Restriction on Commerical Use of Health Data Unconstitutional

The indispensable How Appealing blog reported this morning that the U.S. Court of Appeals for the Second Circuit, in a 2-1 decision, found that a Vermont law which prohibited the sale or use of information about doctors’ prescribing patterns violates the First Amendment.  Washington Legal Foundation filed a brief in support of the petitioner in the case, IMS Health, advocating for commercial speech rights. 

The Vermont law, which is similar to laws passed in other states such as Maine, does not address information about the ultimate consumer of prescription drugs – the patient.  The information in which data companies like IMS Health are interested is which doctors are prescribing which drugs, information which is aggregated and deployed by pharmaceutical marketers to make their efforts more efficient and targeted.  Such information use makes good sense for doctors as well, given that their time is limited and they don’t want products pitched to them in which they have no interest. 

As Harvard Law Professor Laurence Tribe wrote about these laws in a 2009 WLF Legal Opinion Letter, they are

intended to prevent conversations between doctors and drug companies about the merits of different treatments — and are designed to do so by bottling up prescription-related information at its source in the pharmacies that fill the prescriptions.  In other words, the state is blocking the transfer of information in order to make it harder for drug companies to locate the doctors who would be most interested in how (not by whom) the companies’ products have been used.

We’ll have more to say on the Second Circuit’s ruling once we’ve digested it, but in the meantime, congratulations to IMS Health’s counsels, Thomas Julin of Hunton & Williams LLP and Thomas Goldstein of Akin Gump Strauss Hauer & Feld LLP (and member of WLF’s Legal Policy Advisory Board).

FDA to Epilepsy Patients: You Really Aren’t Having Problems with Your Seizure Drugs

The FDA Law Blog reported this morning on an October 7 response by the Food & Drug Administration (FDA) to a state senator in New Jersey who had written the agency seeking its opinion on a bill that would “require pharmacists to dispense epilepsy drugs from the same manufacturer as previously dispensed for certain patients, unless otherwise prescribed.” Senator Joseph Vitale’s concerns with the effect on epileptics of switching from branded to generic drugs, or among different generics, have been echoed by physicians, epilepsy patient advocates, and scholarly researchers.  While FDA didn’t offer any direct thoughts on the bill, the letter was written in such a haughty and dismissive tone that the agency’s opinion came through loud and clear: butt out, there is no problem, we know what we are doing here in Washington. Continue reading “FDA to Epilepsy Patients: You Really Aren’t Having Problems with Your Seizure Drugs”

Last Week At WLF

Litigation Updates:

 

  • Goodyear Luxembourg Tires, SA v. Brown
    On November 19, 2010, WLF urged the U.S. Supreme Court not to permit plaintiffs’ lawyers to use U.S. courts as a platform for asserting claims against foreign companies that bear no relation to the United States. The case raises important issues about the continued viability of the Supreme Court’s longstanding protections against the exercise of personal jurisdiction by U.S. courts over foreign corporations.
  • Capital Ventures International v. Republic of Argentina
    On November 17, 2010, WLF filed a brief in the U.S. Court of Appeals for the Second Circuit, urging it to uphold the right of bondholders to seek to collect judgments against foreign states that have defaulted on their commercial debt. WLF argued that the Foreign Sovereign Immunities Act already provides foreign states with significant immunity from lawsuits in American courts.
  • Doe v. Exxon Mobil Corp.
    On November 12, 2010, WLF filed a brief in the U.S. Court of Appeals for the District of Columbia Circuit, urging it to uphold the dismissal of a suit by activists who claim that a multinational corporation aided and abetted human rights violations by the government of Indonesia, by providing financial support to security forces.

From The Legal Pulse: