ARTICLE
27 April 2025

Vanda Pharmaceuticals Inc. v. FDA: Industry's Latest Attempt To Clarify Off-Label Promotion Rules

SJ
Steptoe LLP

Contributor

In more than 100 years of practice, Steptoe has earned an international reputation for vigorous representation of clients before governmental agencies, successful advocacy in litigation and arbitration, and creative and practical advice in structuring business transactions. Steptoe has more than 500 lawyers and professional staff across the US, Europe and Asia.
Doctors have always had the discretion, without any federal interference, to prescribe approved drugs and medical devices for unapproved, off-label uses, and patients have been free...
United States Food, Drugs, Healthcare, Life Sciences

Doctors have always had the discretion, without any federal interference, to prescribe approved drugs and medical devices for unapproved, off-label uses, and patients have been free to take them for such uses. Indeed, off-label use "is an accepted and necessary" medical practice that often represents the standard of care. Buckman Co. v. Plaintiffs' Legal Comm., 531 U.S. 341, 350 (2001). Although the Federal Food Drug and Cosmetic Act (FDCA) does not directly prohibit promotion of off-label uses, the Department of Justice (DOJ) and Food and Drug administration (FDA) have long attempted to prosecute, both civilly and criminally, such "off-label promotion" under the theory that drugs or devices intended for off-label use are "adulterated" and "misbranded." United States v. Facteau, 2020 WL 5517573, at *1 (D. Mass. Sept. 14, 2020) (noting that "the statutory and regulatory scheme needs to be rethought" and that the government's theory "criminalizes conduct that it is not entirely clear Congress intended to criminalize"), aff'd, 89 F.4th 1 (1st Cir. 2023), cert. denied, 145 S. Ct. 137 (2024). For the last three decades, the industry has fought back, arguing that DOJ and FDA are infringing on manufacturers' First Amendment commercial speech rights. Vanda Pharmaceuticals Inc. v. FDA1 represents the latest entry in this three-decade fight.

Vanda's First Amendment Argument

For years, Vanda Pharmaceuticals Inc. (Vanda) has argued that its drug, Hetlioz (tasimelteon), is a safe and effective treatment for jet lag. FDA has repeatedly rejected that argument. While FDA approved Hetlioz for limited sleep disorders,2 it has repeatedly demanded that Vanda provide additional evidence of Hetlioz's efficacy, including proof of clinically meaningful sleep improvement over a placebo, before it can expand its label to include treatment of jet lag disorder. In the absence of that evidence, FDA has repeatedly rejected Vanda's request for this label expansion.

As a result of FDA's refusal to approve an expanded label for Hetlioz, using the drug to treat jet lag disorder is an "off-label" use. Doctors and patients may engage in off-label use, but the FDCA and FDA regulations limit the extent to which manufacturers can promote or intend off-label use.

Despite the restrictions on off-label use, Vanda desires to distribute three peer-reviewed studies to physicians that support using Hetlioz to treat jet lag disorder, accompanied by coversheets, article summaries, and descriptive statements about the studies all generated by Vanda. It couches this desire in terms of the need for doctors to "make informed treatment decisions by consulting the cutting edge of scientific knowledge." Compl. ¶ 1; see also id. ¶ 2 ("Doctors must have the best information available to make the best medical decisions ...."); id. ¶ 8 ("To make the best medical judgments, doctors should have all available truthful and non-misleading information at their disposal.").

In January 2025, FDA issued new guidance on this topic titled "Communications From Firms to Health Care Providers Regarding Scientific Information on Unapproved Uses of Approved/Cleared Medical Products: Questions and Answers" ("2025 FDA Guidance"). The 2025 FDA Guidance, which consolidates and revises guidance from 2009, 2014, and 2023, permits pharmaceutical and device manufactures to disseminate limited scientific or research information about unapproved uses of approved drugs or devices without running afoul of the FDCA's prohibitions against off-label promotion.3 The 2025 FDA Guidance requires that any such scientific or research information be informative, truthful, and not misleading, and present all information necessary for health care providers to understand and evaluate the strengths and weaknesses, validity, and clinical utility of the scientific information on unapproved use(s) in that specific communication. Using a collection of questions and answers, the 2025 FDA Guidance further restricts the manner in which such informative, truthful, and not misleading information can be disseminated.

Most importantly for this case, the 2025 FDA Guidance "recommends" that when disseminating scientific or research information about unapproved uses, firms state "that the safety and effectiveness of the medical product for the unapproved use has not been established." Guidance at 15. Here, if Vanda desires to distribute three peer-reviewed studies, and Vanda-generated materials about the studies, to doctors about using Hetlioz to treat jet lag disorder, then it must also advise those doctors that "the safety and effectiveness of Hetlioz for treating jet lag disorder has not been established." See Compl. ¶ 9 (alleging that the FDA has "compeled" such a statement as a condition of safe harbor from criminal prosecution).

Vanda believes that the disclaimer required by the 2025 FDA Guidance is wrong. In Vanda's opinion, the safety and effectiveness of Hetlioz for jet lag disorder has been established. Vanda therefore argues that it is being forced to espouse an opinion it does not hold concerning an issue that is subject to good-faith debate. Compl. ¶¶ 11, 228-31. The result, says Vanda, is that its speech will be compelled in violation of the First Amendment, and that doctors will be misled. Id. ¶¶ 11-14.

Based on the alleged violation of First Amendment rights by limitations on its proposed off-label promotion, Vanda has joined with a co-plaintiff physician and co-plaintiff patient in bringing this lawsuit. All three plaintiffs argue that FDA's prohibition on truthful, non-misleading speech that discusses off-label uses of drugs is unconstitutional under the First Amendment, as they are content-based regulations—or at the very least, commercial speech regulations that do not pass muster under either applicable level of heightened equal protection review (i.e., intermediate scrutiny or strict scrutiny). The plaintiffs rely in large part on two cases: United States v. Caronia, 703 F.3d 149 (2d Cir. 2012) (holding that prohibiting off-label promotion would violate the First Amendment) and Amarin Pharma, Inc. v. FDA, 119 F. Supp. 3d 196 (S.D.N.Y. 2015) (enjoining the FDA from bringing an enforcement action in response to Amarin's truthful, non-misleading off-label promotion). The plaintiffs argue that these two cases align with the Fifth Circuit's approach to restrictions on free speech since the Fifth Circuit recognizes that the First Amendment protects businesses from overbroad regulations on commercial speech that will cause truthful and non-misleading expressions to be snared along with fraudulent and deceptive ones. Compl. ¶ 214 (citing Am. Acad. of Implant Dentistry v. Parker, 860 F.3d 300, 308 (5th Cir. 2017)). The plaintiffs therefore argue that they have a First Amendment right to engage in and receive truthful, non-misleading speech promoting off-label use of Hetlioz.

The plaintiffs attack the 2025 FDA Guidance's alleged required disclaimers that "the safety and effectiveness of the medical product for the unapproved use(s) has not been established" and disclose (if applicable) other scientifically sound studies that conflict with the conclusions of the studies described in a firm communication. Compl. ¶ 228. They further argue that these disclaimers are compelled commercial speech that are neither purely factual nor uncontroversial, which means that the requirement must satisfy strict scrutiny. Id. ¶¶ 229-31 (citing RJ Reynolds Tobacco Co. v. FDA, 96 F.4th 863, 876, 885 & n.73 (5th Cir.), cert. denied 145 S. Ct. 592 (2024)). According to the plaintiffs, whether the safety or effectiveness of a drug has been established is a matter of scientific interpretation or opinion, not fact or law, and even if the statements were factual in nature, they are not uncontroversial because, in this case, Vanda "vehemently disagrees" with the claim FDA would compel it to make: that the safety and effectiveness of Hetlioz are not established. Id. Because FDA cannot satisfy strict scrutiny, it cannot compel Vanda to make such a disputed statement.

FDA's Likely Response

FDA has not yet responded, but you can expect them to raise three arguments. First, you can expect FDA to rely heavily on its post-Caronia argument that although the FDCA does not prohibit off-label promotion, it does prohibit interstate sale of drugs or medical devices that are intended for off-label uses and "using speech merely as evidence of that intent does not raise First Amendment concerns." Facteau,89 F.4th at 25; accord Nicopure Labs, LLC v. FDA, 944 F.3d 267, 282 (D.C. Cir. 2019) (reaffirming Whitaker v. Thompson,353 F.3d 947, 953 (D.C. Cir. 2004)(holding that it is "constitutionally permissible" to use a seller's claims as evidence of intended use, even when doing so "renders the otherwise permissible act of selling the product with FDA approval unlawful")); see also United States v. Vascular Sols., Inc., 181 F. Supp. 3d 342, 345 (W.D. Tex. 2016) (holding that the government may prosecute a conspiracy even if protected speech constitutes the "overt act in furtherance of the conspiracy"). It will likely take the position that regardless of whether Vanda complies with the "safe harbor" from the 2025 FDA Guidance, the legality of its Hetlioz sales turns on Vanda's intent, not its promotional speech. This is not always what FDA and DOJ have said,4 and it is far from clear that FDA and DOJ's latest argument is correct, but see Facteau, 89 F.4th at 25, but FDA and DOJ have each pressed this argument in recent years. Vanda tees up the question once again.

Second, FDA will argue that the 2025 FDA Guidance does not, in fact, compel the speech at issue. Moreover, the 2025 FDA Guidance is non-binding and merely "recommends" the disputed disclaimers as one way to demonstrate that off-label information is truthful and non-misleading, but the 2025 FDA Guidance does not state that the disputed disclaimers are the only way to ensure truthfulness. It will likely argue that if Vanda's statements are in fact truthful and not misleading, then they are covered by the Guidance—with or without the disputed disclaimers. Whether or not Vanda's statements are truthful and not misleading is a fact question that FDA is presumably prepared to litigate following the agency's lengthy consideration of the statements before declining Vanda's requested indication.

Third, FDA will argue that the 2025 FDA Guidance meets strict scrutiny. FDA has a parade of alarming examples it can trot out to illustrate the dangers of off-label use. Most famously, the off-label use of the sedative thalidomide to alleviate morning sickness famously led to the birth of thousands of "thalidomide babies" suffering deformities or death. FDA's argument stands in tension with the protection of off-label use and the trend towards combatting disfavored speech with more speech in lieu of prohibition, and with the compelling record of numerous disease states for which off-label use of a particular drug is the gold standard. See Caronia, 703 F.3d at 166-68; see also Wash. Legal Found. v. Friedman, 13 F. Supp. 2d 51, 73 (D.D.C. 1998), vacated as moot, 202 F.3d 331 (D.C. Cir. 2000). In other words, if FDA believes off-label use of a drug is dangerous, it should combat that use with a prohibition or with its own speech—not with a speaker-specific restriction.

Conclusion

The rights of drug and medical device manufacturers to disseminate information about off-label use has been hotly contested for decades. Vanda's attempt to promote Hetlioz for treatment of jet lag represents the latest entry in that fight and will hopefully bring clarity to a murky regulatory environment.

From an enforcement standpoint, Caronia, Amarin, and their antecedents are frequently invoked to defend pharma and device companies against allegations of off-label promotion, whether in the criminal FDCA or civil False Claims Act (FCA) context. For the most part, however, DOJ (together with FCA relators) and FDA have continued their efforts to police off-label promotion. As a result, despite the trend in favor of increased protections for commercial speech, pharmaceutical and device companies should continue to exercise caution in the written materials they distribute to health care providers, and ensure that any off-label materials it distributes to HCPs is truthful, non-misleading, and fair balanced, and thus defensible as 1st Amendment-protected speech against allegations of illegal off-label promotion.

For decades, industry has asked FDA for guidance on off-label promotion and petitioned the courts to rein in over-aggressive enforcement efforts.5 That guidance has been slow, vague, and vacillating, and as the Vanda Complaint highlights, the 2025 FDA Guidance is arguably only an incremental move toward clarity. Hopefully, the Vanda litigation will change that. We will continue to monitor the developments in the Vanda litigation, and developments in off-label communications enforcement more generally.

Footnotes

1. Vanda Pharmaceuticals Inc. et al. v. Food and Drug Administration et al., Case No. 4:25-cv-01648 (S.D. Tex. April 9, 2025).

2. Hetlioz is a melatonin receptor agonist approved by the FDA for treatment of (1) non-24-hour sleep-wake disorder, a condition in which an individual's circadian rhythms become misaligned with the 24-hour day, and (2) nighttime sleep disturbances in Smith-Magenis Syndrome. Compl. ¶ 76.

3. Although the FDCA does not expressly prohibit off-label promotion, prosecutors and the FDA have taken the position that the promotion of off-label uses of drugs and devices is effectively prohibited because (1) such promotion is evidence of an intended use that is not part of the product's FDA-approved label, rendering it a "new drug" under 21 U.S.C. § 355 or "adulterated device" under 21 U.S.C. § 351(f), and (2) such promotion constitutes either false and misleading labeling or a label lacking adequate directions for use, and thus constitutes misbranding under 21 U.S.C. § 352(a), (f).

4. See, e.g., Caronia, 703 F.3d at 161-62;Ltr. from FDA Chief Counsel Daniel Troy to Jeffrey Gibbs (Oct. 17, 2002) ("It is well settled that intended use is determined with reference to marketing claims."); Fed. Reg. Vol. 65, No. 52, at 14286 (Mar. 16, 2000) ("an approved new drug that is marketed for a "new use" becomes an unapproved new drug with respect to that use."); Ltr. from William B. Schultz (FDA) to Daniel J. Popeo & Richard Samp (Wash. Legal Found.) at 18 (Dec. 3, 1997)) (based upon FDA's examination of information provided by manufacturers "to health care professionals and consumers," the agency then determines "whether the products are being improperly promoted, and therefore misbranded or adulterated."); FDA, Advertising & Promotion; Guidance, 61 Fed. Reg. 52,800, 52,800 (Oct. 8, 1996) (referring to "the statutory requirements that prohibit companies from promoting products for unapproved uses") (emphasis added); FDA, Draft Policy Statement on Industry-Supported Scientific & Educational Activities, 57 Fed. Reg. 56,412, 56,412 (Nov. 27, 1992) (same).

5. See, e.g., Citizen Petition Regarding the FDA's Policy on Promotion of Approved Drugs & De-vices, 59 Fed. Reg. 59,820 (Nov. 18, 1994); Ltr. from Asst. Comm'r Leslie Kux, FDA, Response to Citizen Petitions FDA-2011-P-0512 and FDA 2013-P-1079 (June 6, 2014); Wash. Le-gal Found., 13 F. Supp. 2d 51.

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