United States: Manufacturers of Generic Pharmaceuticals Must Warn of Dangers Learned After Obtaining FDA Approval

In a case of first impression for the U.S. District Court for the Eastern District of Pennsylvania (and the first for district courts within the Third Circuit), the court recently found that Food and Drug Administration (FDA) approval of a generic pharmaceutical does not necessarily protect its manufacturer and distributor from state law claims. In In re: Budeprion Marketing & Sales Litigation, the court refused to accept the defendants' argument that FDA approval (and associated finding of bioequivalence) for a generic drug preempted state law failure to warn claims. MDL No. 2107 (E.D. Pa. May 26, 2010). In doing so, the Eastern District of Pennsylvania has joined numerous other federal courts in reading the U.S. Supreme Court case of Wyeth v. Levine, 129 S. Ct. 1187 (2009), to apply to generic as well as name brand pharmaceuticals.

As a result of the Budeprion decision and other similar federal court decisions, generic pharmaceutical manufacturers and distributors cannot rely upon the bioequivalence and drug labeling approval they received from the FDA to protect them from state law claims. In these decisions, the courts instead expect that if a generic drug's manufacturer learns of adverse side effects or new dosage and efficacy information that should be included in the label, the manufacturer can change its label to reflect such information or otherwise inform consumers and doctors of this information, even if the name brand manufacturer of the drug has not.

In Budeprion, plaintiff consumers had switched from a name brand prescription anti-depressant — GlaxoSmithKline's Wellbutrin XL — to a generic version manufactured by defendant Impax Laboratories Inc. and distributed by defendant Teva Pharmaceuticals. Plaintiffs claimed that after the FDA approved this generic version, sold as Budeprion XL, Defendants learned that the drug differed from Wellbutrin XL and Defendants had a duty to disclose these material differences. Plaintiffs' Complaint stated that Defendants failed to disclose multiple pieces of information, including information about the drug release rate, testing of the generic version, and complaints of adverse side effects and efficacy different from those of Wellbutrin XL.

Defendants argued that because the FDA had found Budeprion XL bioequivalent to Wellbutrin XL and approved its labeling, Plaintiffs' state law claims were preempted by federal law. In addition, Defendants pointed out that although the FDA had received a Citizen Petition concerning Budeprion XL's safety and efficacy, the agency had not required additional warnings on Budeprion XL and had reaffirmed the drug's safety after investigating reports of adverse side effects. The district court, citing Wyeth v. Levine, 129 S. Ct. 1187 (2009), rejected Defendants' preemption argument.

In Levine, the Supreme Court considered whether duties under FDA drug labeling laws preempted a state law duty to modify labeling to give fair warning. The Supreme Court found that it was not impossible for a pharmaceutical manufacturer to change its labeling to comply with state law, as the FDA has a "changes being effected" (CBE) regulation allowing a manufacturer to modify a label to add or strengthen a warning or instruction about dosage and administration. Throughout changes to federal law governing pharmaceuticals, "it has remained a central premise of federal drug regulation that the manufacturer bears responsibility for the content of its label at all times." 129 S. Ct. at 1197-98. Moreover, state law claims are the only recourse for pharmaceutical consumers, and so state law remedies provide important consumer protection, id. at 1199-1200, and complement federal drug regulation. Id. at 1202.

Some federal courts of appeals have applied Levine's reasoning not only to name brand pharmaceutical manufacturers, but also to generic drug makers. See Demahy v. Actavis, Inc., 593 F. 3d 428 (5th Cir. 2010) (noting also that generic drug manufacturers have multiple means to change labels: the CBE process; the prior approval process; and "Dear Doctor" letters, which generic manufacturers can ask the FDA to send); Mensing v. Wyeth, Inc., 588 F.3d 603 (8th Cir. 2009). And as the Budeprion court noted, "[s]ince Levine, district courts have repeatedly refused to hold that state law tort causes of action are preempted." Slip. Op. at 18.

The Third Circuit has not yet addressed this preemption issue, but the Eastern District of Pennsylvania has joined those courts extending Levine to generic pharmaceuticals. The Budeprion court cited multiple aspects of Levine and lower court cases applying Levine, denying preemption to generic drug makers:

  • FDA approval of a generic pharmaceutical does not prevent generic drug makers from being liable for the safety and efficacy of their products;
  • a general presumption against preemption, particularly where a defendant cannot show Congressional intent to the contrary and because state law remedies are the only ones available to a plaintiff;
  • Levine's statement that the drug manufacturer bears responsibility for its label content; and
  • prior FDA approval is not the same as preemption, and drug manufacturers have a continuing obligation to monitor the drugs they produce. Slip Op. at 22-23.

The Budeprion court also noted that allowing state law to apply to name brand but not to generic drugs does not make sense, and Defendants had not shown that compliance with both federal and state law is impossible. Id. at 20-21, 23. "Defendants have offered no compelling reason why Congress would have given generic drug makers favored status." Id. at 21.

The Budeprion court thus concluded that FDA approval and bioequivalence findings do not preempt state law claims against Defendants. The Eastern District of Pennsylvania has joined other federal courts in pointing to mechanisms by which a pharmaceutical manufacturer can amend its labels, including the CBE process. Because "this Court finds it difficult to believe that the FDA would balk at a drug maker seeking to strengthen the warning label on its product," Slip. Op. at 23, short of an actual showing that the FDA refused to alter a drug's label at the manufacturer's request, generic drug manufacturers will not have a successful preemption argument in this District.

This decision strikes a blow to efforts to carve out special treatment for manufacturers of generic pharmaceuticals. The court found that the reasoning of Levine "applies equally well to generic drugs," id. at 21, and found no reason why such manufacturers should receive more favorable treatment than name brand manufacturers. While manufacturers of generic pharmaceuticals enjoy certain procedures for accelerated approval, this Court and others appear to hold such manufacturers to the same post-approval duties as manufacturers of name brand pharmaceuticals.

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