Consumer Advertising Law Blog

Targeting Grandfathered Drugs with Claims of Misrepresentation - Private Enforcement of the FDCA?

The Federal Food, Drug and Cosmetic Act (“FDCA”) imposes specific requirements governing the approval, labeling and promotion of prescription drugs. FDA has exclusive authority to enforce those requirements.

The FDCA grandfathers out of the approval requirements products that were on the market before the statute was enacted. This exception recently created a conundrum for the federal district court in New Jersey, which addressed whether a plaintiff can sue under the Lanham Act claiming that the mere marketing of a grandfathered product, as the FDCA allows, falsely implies FDA approval. In Mutual Pharmaceutical Co., Inc. v. Watson Pharmaceuticals, Inc., Watson was selling a gout medication, which, it argued, was grandfathered. Mutual, unlike Watson, sought FDA approval to manufacture and sell the drug for gout, as well as the exclusive right to market it for a different, rare disease. Upon receiving FDA approval, Mutual, along with two other companies, sued Watson. Mutual alleged that by disseminating advertisements and product information through various channels, Watson falsely implied its drug was FDA-approved.

Watson moved to dismiss the complaint as a disguised effort to enforce the FDCA. Mutual’s claim, Watson contended, required the Court to determine an issue only FDA could decide -- whether Watson needed FDA approval to sell the drug. The Court disagreed. The question under the Lanham Act, the Court found, was not whether Watson needed FDA approval, but whether it falsely implied that it had FDA approval. The Court cited survey evidence in the complaint reflecting the inaccurate perception by consumers that FDA had approved the product. Interestingly, though, the survey dealt not with any advertising claims by Watson but rather with the belief by consumers that pharmacy computers would only display FDA-approved drugs. Watson argued that if marketing its product through traditional channels was sufficient to create the false implication of FDA approval, it could not market the product even though the FDCA allowed it to do so. Nevertheless, the court found that the facts as pled were sufficient to defeat the motion to dismiss.

This result --treating the mere marketing of an allegedly grandfathered drug as inherently misleading and subject to injunction-- is troubling. Arguably, such an injunction either would conflict with the FDCA where the Act did not require FDA approval for marketing, and would enforce the Act through a private right of action where approval was required.

Just how troubling the case is -- and how much latitude it affords for private claims -- is unclear. In an earlier case a California District Court declined to be drawn into what it viewed as enforcement of the FDCA. The plaintiffs in In re Epogen and Aranesp Off-Label Marketing & Sales Practices Litigation brought a RICO claim based on the defendants’ alleged off-label marketing of a kidney drug, in violation of the FDCA. The Court found that the “existence of federal enactments-i.e., the FDCA and accompanying regulations-making off-label promotion illegal, is central to many of Plaintiffs' claims . . . . Allowing Plaintiffs to proceed on a theory that Defendants violated RICO by engaging in off-label promotion, without specific allegations that Defendants made false or misleading statements, would, in effect, permit Plaintiffs to use RICO as a vehicle to enforce the FDCA.” In dismissing the complaint, the Court noted that the plaintiffs were free to bring claims based on wholly separable private causes of action stemming from the same activity.

To be sure, the artful tailoring of the complaint in Mutual Pharmaceutical, while sufficient to skirt a motion to dismiss, may not suffice to sustain the case beyond that stage. If plaintiffs do succeed, it will doubtless require substantial legal debate, not to mention further litigation, to determine where, between Mutual Pharmaceutical and Epogen, the balance tips from a separate, cognizable cause of action to an impermissible private effort to enforce the FDCA.

- Robert Weiner and Jessica Halbert

Tupperware™ Parties And Prescription Drug Marketing: FDA Puts The Lid On A Drug Promotional Campaign

Ever since the Tupperware Company revolutionized direct-to-consumer (“DTC”) marketing through its famous “Tupperware™ parties” of the 1950s, manufacturers have been trying mimic its success. Pharmaceutical manufacturers are among the latest to revive this “old school” technique, and FDA has taken notice.

On January 12, 2010, FDA’s Division of Drug Marketing, Advertising, and Communications (“DDMAC”) posted a December 30, 2009 letter to Bayer HealthCare Pharmaceuticals Inc. (“Bayer”) on its website objecting to a script for a live consumer-directed program for the drug Mirena® entitled “Mirena Simple Style Statements Program” (“Program”). Mirena (levonorgestrel-releasing intrauterine system) is a drug delivery system indicated for intrauterine contraception for up to five years. The drug carries various contraindications and warnings and the FDA-approved label (“PI”) requires that patients be “reexamined and evaluated 4 to 12 weeks after insertion, and once a year thereafter, or more frequently if clinically indicated”.

The Program was developed as a partnership between Bayer and Mom Central, a commercial social networking site “dedicated to providing busy moms with smart household and parenting solutions”. According to FDA’s letter and the allegedly violative Program script, the Bayer-sponsored Program is presented in a consumer’s home or another private setting (such as a private restaurant party). A Mom Central representative starts the presentation with a scripted introduction and then hands the presentation off to a nurse practitioner who follows a scripted Mirena product presentation. After a question and answer session, the nurse practitioner (who Bayer says is trained to keep her messaging consistent with the Mirena PI) hands off the presentation to a stylist who offers fashion tips. The overall effect is to present Mirena as an attractive option to busy moms who are looking for a “lifestyle solution”.

The Mirena FDA letter underscores the need for the pharmaceutical industry to balance clever “lifestyle marketing” with FDA’s standards for substantiation for quality of life claims and risk/benefit balancing. In particular, FDA takes objection to statements in the Program script which suggest that Mirena increases levels of intimacy, romance, and emotional satisfaction. In FDA’s view, these statements overstate Mirena’s efficacy because they have not been proven to be quality of life outcomes supported by substantial clinical experience, noting that 5% of clinical trial patients actually reported decreased libido as a side effect. Further, the nurse practitioner was scripted to state that busy moms who use Mirena, “look and feel great”. FDA points out that this statement, among others, minimizes the risks associated with use of Mirena, which include, irregular bleeding, ovarian cysts, back pain, weight increase, acne and other risks which are not only inconsistent with “feeling great” but are also important risks that need to be communicated to consumers. Finally FDA notes that the script states that Mirena has “no daily, weekly, or monthly routines to comply with” as part of its overall message that Mirena fits into a convenient lifestyle. In fact, FDA notes that the Mirena PI requires both patient and physician follow up.

While presenting a prescription pharmaceutical product as an attractive lifestyle option may be a clever way to advertise directly to consumers, FDA’s response to this consumer program script has made clear that drugs are not Tupperware.

- Daniel Kracov and Mahnu Davar

FDA Public Hearing on Promotion of FDA-Regulated Products Using the Internet/Social Media Tools

Companies that make or market FDA-regulated products are increasingly using Internet and social media tools such as Google searches, Twitter, Facebook and Wikipedia to promote their products and to provide other important information to consumers and health care professionals. While the Internet and social media provide significant benefits to consumers, industry, healthcare professionals and the public as a whole, these forms of media present new legal and regulatory challenges with respect to promotional labeling and advertising, third-party communications about a company’s products, and potential adverse events identified in blogs, chat rooms, and other forms of social media.

On November 12-13, 2009, FDA held a public hearing on the promotion of FDA-regulated medical products using the Internet and social media tools to hear from industry leaders, consumers, public interest groups, and media professionals. The hearing followed a panel-style format in which pre-selected speakers gave prepared remarks with accompanying slide presentations. FDA panel members asked questions of the speakers, but did not otherwise provide prepared remarks or invite participation from the audience.

Internet companies and regulated industry representatives discussed the need to differentiate Internet and social media from other forms of labeling or advertising because, unlike traditional promotional labeling and print or broadcast advertisements, Internet and social media users have a greater ability to control, alter and respond to the promotional messages and other product information they receive. Speakers such as Eli Lilly, sanofi-aventis, and Pharmaceutical Research and Manufacturers of America (PhRMA) agreed that manufacturers should be accountable for online content they control, but noted that manufacturers should not have a broad obligation to police or remove all forms of third-party content about their products.

Sloppy Record Keeping Leads to Loss of Significant Green from Coral Calcium

The FTC can claim another victory against infomercial pitchman Donald W. Barrett and his affiliates over the dietary supplements, "Coral Calcium" and “Supreme Greens” ― products that were found to be falsely marketed as treatments or cures for a host of serious diseases, including cancer, diabetes and heart disease. (FTC press release found here)

This saga began when the FTC initiated an action on June 2, 2004 against the defendants charging them with making false claims regarding the Coral Calcium and Supreme Greens products (complaint found here). A preliminary injunction issued on July 3, 2004 enjoining defendants from making false or misleading claims concerning any dietary supplement during the pendency of the action. Thereafter, and following discovery, the FTC filed a motion for summary judgment against the defendants arguing that they were liable for falsely claiming that the Coral Calcium and Supreme Greens products would treat, cure or prevent any number of health related problems.

In July 2008, District Judge George A. O’Toole, Jr. of the United States District Court for the District of Massachusetts granted the FTC’s motion for summary judgment, finding that the defendants were liable for deceptively touting the cure-all affects of the Coral Calcium and Supreme Greens products. (Summary judgment decision found here) Following this decision, discovery was conducted and a bench trial had to determine the appropriate terms of injunctive relief and the amount of monetary relief to be ordered.

Judge O’Toole has now spoke . . . and he has hit hard. (August 27 decision and order found here) Acknowledging the willful nature of defendants conduct, Judge O’Toole permanently enjoined the defendants from making any representation about the health benefits, performance, or efficacy, of any product (including the Coral Calcium and Supreme Greens products) unless the representation is true, non-misleading, and, at the time the representation is made, the defendants possess and rely upon competent and reliable scientific evidence that substantiates the representation. As for the assessment of disgorgement, Judge O’Toole determined that defendants’ record keeping with respect to profits of the products was not reliable. The Court was troubled that there were multiple different versions of Defendant’s financial statements with different amounts listed for sales and net income, stating “The degree of difference was not so great that a reasonable estimate could not be made on the basis of the differing figures, but the very fact of the variations, together with other evidence about the casual and deceptive way financial information was maintained and reported . . . undermines any confidence that even the ranges reported are close to accurate. The defendants were fiction writers in their infomercial and there is reason to be concerned they were fiction writers in their financial statements.” Thus, the Court accepted the sales numbers advanced by the FTC ― net revenue numbers rather than net profits during the time the ads at issue were run, totaling approximately $70 million. The disgorged sum will be used for consumer redress.

In a Battle of Experts, Only the Fair Survive

What makes up “competent and reliable scientific evidence?” That’s a question that has vexed many a practitioner and client. A federal district court judge in New Jersey recently weighed in on that topic (opinion here) and it wasn’t good news for the FTC. In FTC v. Lane Labs-USA, Inc., et al., the FTC asked that the U.S. District Court for New Jersey fine Lane Labs, a supplier of dietary supplements, $24 million as a result of the lab’s alleged violation of a nine year old consent order in which it agreed to only make representations about the effects of its dietary supplement products that could be supported by competent reliable scientific evidence. In its complaint the FTC alleged order violations relating to two Lane Labs’ products — AdvaCAL, a calcium supplement, and Fertil Male, a product derived from a Peruvian plant known as “Maca” that allegedly increases male fertility.

The Defendant relied upon several clinical studies and the testimony of a scientific expert for each of its products. The FTC’s experts criticisms of the study were familiar ones to those who practice in this area. They included the fact that the studies were underpowered, used rats instead of humans, that the products had inert ingredients not found in the products tested, and that the studies tested one proposition (increase in bone density) from which the claim (reduced risk of fractures) had to be inferred. Defendant’s experts rebutted each of these criticisms.

The Court found that the FTC had not met its burden of proof and that the Defendant had taken reasonable steps to comply with the Order:

• The court found that while all four experts were credible and knowledgeable, the Defendant’s experts were more reasonable. In particular, the court was critical of the overly exacting standard of one of the FTC’s experts in evaluating the reliability of clinical studies.
• Neither of the FTC’s experts found that Lane Labs’ supplements were not effective or constituted a health risk to the public, but instead that the studies relied upon by Lane Labs had “questionable aspects,” including using rats versus humans to study effects and having a smaller number of participants. As the court pointed out, however, Lane Labs’ experts were able to successfully explain why those aspects didn’t corrupt the overall value of studies, thereby swaying the court in their favor.
• The court agreed with Lane Labs’ experts’ more inclusive view of the kinds of research that substantiate claims, including research that is tangentially related, if not directly on point, to a claim.
• The court would not find a violation of the Order where there was simply a difference of opinion among credible experts
• Lane Labs “did what they were supposed to do” in seeking expert advice before relying upon scientific articles and peer reviewed studies attesting to the purported effects of AdvaCAL and Fertil Male. To ask the company to do more would be unreasonable, said the court.

If the Court’s decision is upheld in the face of a likely appeal, it may present a clearer and potentially less exacting path to substantiating dietary supplement and other claims. In particular, so long as a company relies upon legitimate studies that a credible expert says are good, a few flaws here and there or the contrary views of an FTC expert may not be enough to sink the product claims.