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.
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