United States: First Circuit Eye Drop Decision Gets Preemption Right

Last Updated: September 4 2018
Article by James Beck

We confess – when we first considered the spate of eye drop class actions a few years ago, we had trouble taking them seriously. It was tough to get excited about penny-ante allegations that the size of eye drops warranted the attention of federal courts, or warranted class action status. We were not alone in that assessment. See Eike v. Allergan, Inc., 850 F.3d 315 (7th Cir. 2017) (discussed here).

But the judicial skepticism engendered by pathetically weak and blatantly lawyer-driven litigation can produce collateral benefits – like favorable preemption decisions. We hailed the first of those, Thompson v. Allergan USA, Inc., 993 F. Supp.2d 1007 (E.D. Mo. 2014), in our " Mensing – It's Not Just About Generics Anymore" post over four years ago. Thompson held that the plaintiffs' attacks on the size of the eye drops was a challenge to the FDA-approved dose of that product. Dosage alterations, however, were "major changes" that required FDA pre-approval. The need for such pre-approval, however, barred the claim under the impossibility preemption rationale of Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013), and PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011).

We also considered Thompson as proof that we hadn't been "baying at the moon" in our 2013 " 'Major' Drug Labeling Changes That Require FDA Prior Approval" post, where we listed a bunch of drug-related changes that the FDA considered "major" and argued that they should all be preemptive under the Mensing/Bartlett rationale.

Thompson didn't go any further, but a Massachusetts district court reached essentially the same result in Gustavsen v. Alcon Laboratories, Inc., 272 F. Supp.3d 241 (D. Mass. 2017):

FDA regulations, as interpreted by the FDA, now prevent defendants from changing the "size and/or shape of a container for a sterile drug product" unless and until the FDA determines that its benefits outweigh any harms. The decision whether such a change should be made is, therefore, reserved for FDA, and the Supremacy Clause prohibits judges and juries from displacing or second-guessing the FDA based on the laws of Massachusetts or other states.

Id. at 255-56 (citation to same FDA guidance cited in our 2013 post omitted). Oddly, Thompson was not cited in Gustavsen. We blogged about that decision here.

A few days ago, the First Circuit affirmed, in Gustavsen v. Alcon Laboratories, Inc., ___ F.3d ___, No. 17-2066, 2018 WL 4057381 (1st Cir. Aug. 27, 2018), and that decision is a preemption home run. Gustavsen decided a "single question" – "Can manufacturers of prescription eye drops change the medication's bottle so as to alter the amount of medication dispensed into the eye without first getting the FDA's approval?" The answer to that question being "no," "state law claims challenging the manufacturers' refusal to make this change are preempted." Id. at *1.

The major dispute in Gustavsen wasn't the law. Even plaintiffs appeared to concede that preemption flowed from a "prior agency approval" requirement under Mensing/Bartlett:

The principles of federal preemption that control our disposal of this appeal are not in dispute. If a private party (such as the manufacturers here) cannot comply with state law without first obtaining the approval of a federal regulatory agency, then the application of that law to that private party is preempted. Conversely, a private party's ability to do without prior agency approval that which state law requires defeats a preemption defense even if the federal regulatory agency retains authority to reject the changes, unless the defendant establishes by clear evidence that the agency would, in fact, reject the changes.

Id. (citations and quotation marks omitted).

The disputed question was whether a tort-required change to the dispenser of a drug (here, eye drops) that had the effect of reducing the size of the drop – and thus the dosage of the drug in that drop – required FDA prior approval. The pertinent FDA regulation, 21 C.F.R. §314.70 (another part of which, (c)(6)(iii), is Levine's notorious "CBE regulation"),

divid[es] changes into three categories: major, moderate, and minor changes. The classification of the manufacturer's anticipated alteration into one of these three categories dictates the manufacturer's ability to unilaterally implement its change. Major changes require approval from the FDA prior to implementation, while moderate and minor changes do not.

Gustavsen, 2018 WL 4057381, at *5 (emphasis added).

Controlling case law is clear − and plaintiffs here concede − that if the change they contend state law requires qualifies as "major," then federal law preempts plaintiffs' cause of action because defendants cannot lawfully make such a change without prior FDA approval.

Id. That's the key. Gustavsen's main takeaway is its holding that "if the change [plaintiffs] contend state law requires qualifies as "major," then federal law preempts plaintiffs' cause of action." Id. (emphasis added). That's precisely what we first argued back in 2013: that where certain "changes are considered sufficiently 'major' that they require FDA prior approval . . . those sorts . . . [of] changes should be preempted" by Mensing/Bartlett.

Much of the remaining preemption discussion in Gustavsen was to reject plaintiff-side pettifoggery. The First Circuit ruled that §314.70(b) was properly read to include subsection (b)(1)'s "broad category of qualifying changes" as "major" – including "sections (b)(2)(i) through (viii)." 2018 WL 4057381, at *6. Rejecting plaintiffs' attempt to parse the regulation in a cramped fashion, Gustavsen "conclude[d] that, if a change fits under any of the categories listed in section (b)(2), that change necessarily constitutes a 'major' change requiring FDA pre-approval." Id. (emphasis added). One of those categories, §314.70(b)(2)(vi), was a "comfortable" fit for the plaintiffs' dosage claims, thus mandating preemption. Gustavsen, 2018 WL 4057381, at *7. Like the district court, the First Circuit in Gustavsen relied upon, inter alia, the same FDA guidance that we did back in 2013. Id. at *8.

Finally, the First Circuit rejected each of the plaintiffs' three "retorts." First, "[w]e do not share plaintiffs' reading of the preamble" to the Federal Register notice that finalized §314.70, id., and "[i]n any event, it is well-established that a regulatory preamble is incapable of altering regulatory text's plain meaning." Id. (citation omitted). Second, the dosage was not "one drop" of any size. Id. at *9. Third, allegations that the FDA had, in practice, not always enforced the pre-approval requirement as to eye drops did not trump the regulation itself, since "the regulatory actions to which plaintiffs point" were "made by mid-level FDA scientists, or even a single 'reviewer,'" and thus did not "reflect" the FDA's "fair and considered judgment." Id.

We think Gustavsen is a big deal, since its logic extends far beyond the rather trivial allegations ginned up by the class action lawyers who have pursued the eye drop litigation. There are a lot of potential drug-related changes that the FDA considers "major" under the regulation and guidance documents relied upon in Gustavsen. These include "changes in the qualitative or quantitative formulation of the drug product, including inactive ingredients, or in the specifications provided in the approved NDA." §314.70(b)(2)(i) (emphasis added). In other words, as we concluded when we first discussed Thompson, "We hasten to add that the same argument preempts all design defect claims against FDA-approved products since all design changes require pre-approval." Plaintiffs also frequently assail defendants for not more thoroughly testing their products. Well, "major" changes also include "[c]hanges requiring completion of studies" and "[c]hanges to a drug product under an NDA that is subject to a validity assessment because of significant questions regarding the integrity of the data." Id. §(b)(2)(ii) and (viii). A number of label changes, including to "highlights" and to "medication guides" are also "major." Id. §(b)(v)(B-C).

The Gustavsen rationale – "major" change = FDA pre-approval = preemption − should also apply to medical devices, since modifications to devices follow a similar regulatory framework:

(a) . . . [E]ach person who is required to register his establishment . . . must submit a premarket notification submission to the Food and Drug Administration . . . days before he proposes to begin the introduction or delivery . . . of a device intended for human use which meets any of the following criteria:

* * * *

(3) The device is one that the person currently has in commercial distribution or is reintroducing into commercial distribution, but that is about to be significantly changed or modified in design, components, method of manufacture, or intended use. The following constitute significant changes or modifications that require a premarket notification:

(i) A change or modification in the device that could significantly affect the safety or effectiveness of the device, e.g., a significant change or modification in design, material, chemical composition, energy source, or manufacturing process.

(ii) A major change or modification in the intended use of the device.

21 C.F.R. §807.81(a) (emphasis added).

Finally, the Gustavsen rationale – being a basis for implied preemption – is not necessarily limited to the FDCA. To the extent that other products are subject to federal pre-approval, they, too, may have a preemption defense available. We don't claim to be experts in such products, but one example that comes to mind is aviation, where FDCA "conflict preemption principles" have already been applied in at least one case. See Sikkelee v. Precision Airmotive Corp., 822 F.3d 680, 702-03 (3d Cir. 2016).

Sometimes bad litigation can make very good law.

This article is presented for informational purposes only and is not intended to constitute legal advice.

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