United States: Parallel Claims – The Government's Position Revealed İn Allergan v Athena

Last Updated: June 10 2015
Article by Michael A. Walsh

A Clarion call for an industry poised to win the battle but lose the war?

We said it before and it bears repeating: there is something inherently troubling when a prescription drug manufacturer wants a jury to decide a product claim under state law that should be decided by the Food and Drug Administration (FDA) under federal law. Not enough has been written about this case but, with the Supreme Court poised to decide what is almost certain to be a landmark case, all eyes should be on Allergan et al. v Athena, No. 2013-1286, 2013 U.S. App. LEXIS 25746 (Fed. Cir. Dec. 30, 2013) (here).

Why is this case so bad for the industry?

Manufacturers of FDA regulated products have generally enjoyed a decade of favorable rulings on the issue of federal preemption and the primacy of jurisdiction of the FDA, but the political climate and emerging new approaches by the Courts threaten to reshape the litigation landscape. The FDA itself has flip-flopped from its prior view favoring preemption to its position that now assists private litigants in pursuing private tort and Lanham Act "labeling" claims under the Food Drug and Cosmetic Act (FDCA). However, unlike many parallel claim cases where an individual litigates against a manufacturer—and human outcomes and injuries tend to factor into the court's search for a remedy—here, a manufacturer has sued a manufacturer. For a detailed discussion of the underlying case please see our prior post ( here).

The issue in Allergan is whether the FDA has exclusive authority to determine a product's regulatory classification. Determining a product's regulatory status is a difficult and complex matter. Even those well versed in the complexities of FDA practice often wrangle with the FDA over whether a product is a food, supplement, cosmetic, device, drug or combination product. There is no clearer example of the complexity of the process than in the June 8, 2015 letter that FDA served and filed in Amarin v FDA wherein FDA details the complexity of the analysis FDA employs when considering whether a claim rises to the level of requiring new drug approval and that the analysis differs whether the product is a drug or a product not requiring FDA approval, such as a dietary supplement or cosmetic. See Amarin v FDA 1:15-cv-03588, Doc. # 24 (SDNY). Leaving the classification decision to the ipse dixit of state court juries is an invitation for litigation chaos.

First things first: Does Allergan v. Athena involve a "Parallel Claim"?[1]

The definition of a "drug" under the California FDCA mirrors that of the FDCA, i.e., whether a substance is a drug is determined by the manufacturer's "intended use." "Intended use," however, is a term defined under FDA regulations, not California state law. Under those regulations, the FDA determines a manufacturer's intended use of its product "by such persons' expressions or may be shown by the circumstances surrounding the distribution of the article . . . including labeling claims, advertising matter, or oral or written statements by such persons or their representatives." 28 CFR 201.128. A product is an unapproved new drug if the FDA determines that the manufacturer intended the product to be used for a purpose that constitutes a "drug" under the FDCA. The FDA regulation on "intended use" does not have a "parallel" under California state law. To reach its conclusion, the Federal Circuit borrowed the FDA regulation to allow Allergan's claims to proceed. In Allergan, the FDA never determined whether Athena intended to market a cosmetic or a new drug and, thus, the Federal Circuit Court stood in the shoes of the FDA to apply 28 CFR 201.128 and determine Athena intended its cosmetic to be used as a drug.

In Allergan the "new drug" issue relates to an unfair business practice where a less expensive product—which was not subject to FDA approval—can compete with a prescription drug by making the same product claims as the approved drug. In all material respects, California law mirrors federal law but both are silent on who decides the threshold issue of whether the product at issue is a cosmetic, not subject to FDA approval, or a drug which is subject to approval by the FDA. There is no suggestion that drug approval could have been granted by the State of California, but the trial court broke new ground and concluded: "RevitaLash Advanced was a new drug that required approval under California law based on, among other facts, petitioner's marketing claims about eyelash growth and petitioner's strategy of promoting its various formulations of RevitaLash through comparison of the product to Latisse." See Gov't Brief at 6.

The Government's Jagged Parallel Line

On May 26, 2015, at the invitation of the Supreme Court, the Solicitor General expressed the views of the government in Allergan on whether the FDA or state court juries decide the regulatory status of FDA-regulated products. The government's position breaks new ground, by allowing state courts to decide a product's drug status and may significantly blur the lines between state law claims and claims seeking to enforce the FDCA.

It is important to note that in Allergan there was no FDA action, no record of communications between the manufacturer and the FDA, nor any determination regarding a classification by the FDA. Moreover, the government does not state whether the analysis would be the same (i.e. allowing a parallel state law claim to proceed) had the FDA reviewed the matter and not taken regulatory action for failure to file a new drug application. The government does, at least, nod in approval for preemption when the FDA was aware of the new use/off-label use. See Gov't Brief at 20 citing Perez v. Nidek, 711 F.3d 1109 (9th Cir. 2013). Oddly, the government suggests that if the state were attempting to impose criminal sanctions, that circumstance "might alter the preemption calculus." See Gov't Brief at fn5, page 15.

In the view of the government, the absence of an FDA determination of whether a product is a drug subject to FDA approval leaves the states free to decide the regulatory classification as they see fit. In this regard, the government cites Wyeth v Levine, 555 U.S. 555 (2009) stating:

This Court has concluded, however, that "Congress did not intend FDA oversight to be the exclusive means of ensuring drug safety and effectiveness, and that FDA has "traditionally regarded state law as a complementary form of drug regulation," Indeed, Congress specified, when enacting the modern drug pre-approval regime, that the FDCA does not "invalidat[e] any provision of State law which would be valid in the absence of such amendments unless there is a direct and positive conflict between such amendments and such provision of State law." Id. at 575, 578-79

Despite the FDA's $1.3 billion dollar budget and 15,000 employees, the government states that allowing state juries to decide the regulatory status of FDA-regulated products does not compromise FDA's objectives because

While FDA is well-equipped to decide the adequacy of pre-market submissions actually filed with the agency, this Court has noted FDA's "limited resources to monitor" the thousands of drugs on the market after they have been approved. The agency's capacity to police the vast marketplace of consumer products that have never been submitted to FDA for pre-market review is even more constrained. Moreover, both the FDCA and California's Sherman Law make it the manufacturer's burden, not FDA's, to establish through a rigorous vetting process that any new drug is safe and effective for its intended use. (citations omitted) Brief at 13-14.

The purported "tort of off-label promotion" posits that a manufacturer that promotes a drug for a "new use" is promoting an unapproved new drug and until or unless the FDA approves the new use and labeling, there is no sufficient warning for the new use/new drug, thereby subjecting the manufacturer to tort liability. If the Court agrees with the government in this case, it will no longer be for the FDA alone to decide whether the product's intended use is that of a drug, and there is no limit to the claims that will be allowable for products—whether approved by the FDA or not—where the claimant alleges a use that renders it subject to approval in another classification.

The government's position in this case is important not merely because of its permissive view of allowing state law to establish product classification for drugs, but because there is little, if any, principled basis for distinguishing this case from any other off-label drug or device promotion case. What may be an unintended consequence of Allergan is what is at issue in the emerging case law concerning off-label promotion, i.e., is the product a "new drug" or "new device" requiring FDA approval or clearance, and who decides?

It remains to be seen where the Court will land in the event it decides this case. However, no matter how the Court rules, this could well be a landmark Supreme Court ruling for those defending purported "new drug" claims, particularly those on the frontier of the tort of off-label promotion. Affirmance could be viewed as a good day for tort lawyers but a landmark mistake for industry.


[1] For further discussion of what are parallel claims and where they came from, see our blog: The Preemption Pendulum: The Supreme Court Punts Stengel v. Medtronic

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Michael A. Walsh
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions