Friday, February 29, 2008
We have a question for you.
Why do big law firms undervalue blogs?
There's a weird network of lawyers at big firms who have never met each other, but feel a certain kinship because they blog under similar circumstances. And we've been contacted recently by others at large firms whose institutions either do not help, or affirmatively obstruct, their blogging efforts. We haven't encountered many problems at our firms (although the smart money says that the firms' ignorance is our bliss).
One thing, however, has crossed our mind: The two of us, toiling alone, with no financial help from our firms, have (to our complete surprise) almost accidentally created the most widely read product liability blog on the internet, now receiving more than 25,000 pageviews per month. In that situation, wouldn't you expect at least a few of your colleagues to wander down the hall and ask two questions: (1) How did you do it? and (2) How can we replicate it?
Our firms surely benefit indirectly from the attention that this site receives. Wouldn't our firms also benefit if they were affiliated with (or even sponsored) the most widely read securities law blog on the internet? Intellectual property blog? Tax law blog?
Why aren't our colleagues beating a path to our door to try to replicate our little experiment?
We propose four possible answers:
First, we're breathing our own fumes. "Most widely read product liability blog on the internet" is like "world's tallest midget." 25,000 pageviews is a drop in the bucket, and there's essentially no institutional benefit to blogging. If the two of us -- Beck and Herrmann, the blogging morons -- want to waste our Saturday mornings feeding this beast, we should go ahead and entertain ourselves. But no one should think this has any institutional value.
Second, influential lawyers are too old. They're basically folks over 50 who start their days sipping a cup of coffee and reading the Journal. Only people under 40 start their days sipping a cup of coffee and checking Above the Law, the Law Blog, Overlawyered, and other blogs. People who have never visited a blog can't believe that anyone else does, either. The power of the blogosphere is simply beyond their comprehension.
Third, blogs attract the wrong demographic. The target market for big firms such as ours is the general counsel and C-level management of Fortune 500 companies. With all due respect to our visitors -- and we love you guys; really! -- you folks are younger and less important. Although a blog can be widely read, it's widely read by the wrong eyeballs and so not worth the effort.
Or, fourth, blogging is too much work for too little financial reward. It takes many hours of effort each week for the two of us to provide regular, fresh content to this site, and the amount of business generated doesn't justify the effort. If the two of us get some personal satisfaction from blogging, no one will interfere, but firms do cost-benefit analyses of marketing initiatives, and this one flunks the test. (If that's the answer, it's cool with us. We surely aren't doing this for the financial rewards.) (Come to think of it, why the heck are we doing this?) (Wait! An awful lot of drug and device companies visit this space regularly. If those folks would like to help us provide a financial justification for the existence of the Drug and Device Law Blog, our phone numbers are easy to find.)
We're curious to hear the reactions of others to our question. So we'll see if Adam Smith, Esq., or the others choose to answer our call, and we'll be interested in reading your comments to this post.
(When we write heresies such as these on-line, we have to be careful about including our firms' names in the post. If we type in our firms' names, many of our colleagues will receive "Google Alerts" telling them the firms have been mentioned on-line. On the other hand, Google doesn't pick up misspelled names. So, if anyone from Dxchert or Jxnes Day comes to this site, Beck and Herrmann each deny that they wrote this post. It's the other guy's fault. Or a hacker. Or something.)
Thursday, February 28, 2008
Yesterday, the Pennsylvania Supreme Court entered an order, accepting allocatur (that's Pennsylvanian for "appeal") to answer the following question:
"Whether this Court should apply §2 of the Restatement (Third) of Torts in place of §402A of the Restatement (Second) of Torts."
Thirty years ago Pennsylvania rigidly separated strict liability and negligence in Azzarello v. Black Brothers. Now the court will reconsider that decision.
The case, for those interested: Bugosh v. I.U. North America, Inc., No. 350 WAL 2007 (this number will now change to a "WAP" number) (Pa. Feb. 27, 2008).
We've just learned of another appellate court reaching just the same conclusion. In Caputo v. United States, 517 F.3d 935 (7th Cir. 2008) (copy here), the court stated:
The district judge did not abuse his discretion — the right standard, see General Electric Co. v. Joiner, 522 U.S. 136 (1997) — in keeping out of evidence the proposed “expert” testimony that defendants wanted to introduce. The “expert” would have testified about the meaning of the statute and regulations. That’s a subject for the court, not for testimonial experts. See Bammerlin v. Navistar International Transportation Corp., 30 F.3d 898, 900 (7th Cir. 1994). The only legal expert in a federal courtroom is the judge.
Caputo, slip op. at 12. This is, to our knowledge, the first federal appellate ruling excluding an "FDA expert" on the ground that the proffered opinions were improper legal conclusions.
We were busy at the time – Riegel, after all, was decided later the same day. Then there was the oral argument in Warner Lambert v. Kent. Oh yeah, and we had real work too.
Anyway, as a result we’re ended up rather behind the curve on this particular issue. It’s been covered in the New York Times, the Wall Street Journal (twice), FDA news, Pharmalot, PharmTech, PharmExec, MedicalDeviceLink, DrugTopics, Shalhoub, MedicalNewsToday, NCPA, HospitalBuyer, PharmaceuticalOnline, HealthNewsDigest, ClinicalTrials, the Mass Torts LawProfessors, and lots of others.
Predictably - almost reflexively - Public Citizen and the ususal suspects in Congress jumped all over the FDA for this allegedly significant loosening the rules about off-label promotion. Bloomberg provided a comprehensive report on the criticism. Pharmalot also covered these dissenters. Public Citizen took the oh-so nuanced position that “People will die if they are getting drugs that don’t have clear evidence that the benefits outweigh the risks.” The reaction of Rep. Henry Waxman (D-CA) is reported in several places as commenting that the FDA’s proposed rule “caters to the industry’s desire to market their products without adequate testing or review,” as commenting that the FDA is creating a “large loophole,” and as hinting darkly at industry collusion with the FDA. Other critiques couched in greater or lesser hyperbole can be found here, here, here, and here.
So what can we belated latecomers add?
Before we answer that, we want to be quite frank about our positions on off-label use and manufacturer promotion of it. As far as off-label use itself, we’re unabashedly for it, and we’ve said so before. While there are, of course, risks to using drugs and medical devices in ways that have not been subjected to the rigors of the FDA’s approval processes (just as there are risks to using drugs for their approved uses), there are also huge benefits. Medical science moves much faster than FDA regulatory evaluation, so cutting edge medical advances are almost by definition off-label – in other words, off-label use is frequently the recognized medical standard of care. Also there are many relatively rare medical conditions that have no on-label treatments at all because economics unfortunately doesn’t justify the expense of clinical trials (one of us has a close family member with just such a condition). Nor with the rise of the generic industry is there any incentive for manufacturers to spend the money to get FDA approval for new uses of drugs that are, or soon will be, off-patent.
As far as off-label promotion is concerned, we recognize that it’s illegal. That being said, we’ve always believed (and have been on record since 1998) that the FDA’s extensive prohibitions against manufacturers being able to publicize beneficial off-label uses of their products is detrimental to the public health. Doctors engage in off-label use because, in their medical judgment, the benefits of a particular off-label use outweigh the risks for individual patients. We think doctors are more competent than both regulators and lawyers to make those decisions.
Thus we believe that doctors should have more, rather than less, truthful information so they can best make what can be very difficult judgment calls. We don’t think it’s beneficial to put obstacles in the way of doctors being able to get accurate information about off-label uses. Further, we think that manufacturers are a logical source for this kind of information, since the whole point of the FDA’s post-marketing reporting regime is to ensure that manufacturers know more about their drugs and devices than anybody else.
As the Supreme Court has held, “The First Amendment directs us to be especially skeptical of regulations that seek to keep people in the dark for what the government perceives to be their own good.” 44 Liquormart, Inc. v. Rhode Island, 517 U.S. 484, 503 (1996). Thus, it’s our position – and we disagree with the FDA on this – that off-label promotion is constitutionally protected speech, as long as: (1) the information being disseminated is truthful (we cannot emphasize “truthful” enough), and (2) is identified as involving an off-label (and thus to some extent less-than-fully vetted) use. Again, we’ve gone on record before taking this position, so none of this will come as any surprise to longtime readers of this blog.
Our take: the FDA's proposed guidance is a baby step; and the “controversy” about it is much ado about very little. The FDA is not giving up anything that the courts wouldn’t eventually take from the Agency anyway. To avoid an adverse ruling on the First Amendment in 2000, see Washington Legal Foundation v. Henney, 202 F.3d 331 (D.C. Cir. 2000), the FDA was forced to agree to a “safe harbor” for reprints, which it formalized at 65 Fed. Reg. 14286 (FDA Mar. 16, 2000). Now, the Agency recognizes that truthful off-label information is of distinct benefit to doctors, patients, and society:
FDA does, however, recognize the important public policy reasons for allowing manufacturers to disseminate truthful and non-misleading [medical and scientific information] on unapproved uses of approved drugs and. . .medical devices to healthcare professionals and healthcare entities. Once a drug or medical device has been approved or cleared by FDA, generally healthcare professionals may lawfully use or prescribe that product for uses or treatment regimens that are not included in the product’s approved labeling. . . . These off-label uses or treatment regimens may be important and may even constitute a medically recognized standard of care. Accordingly, the public health may be advanced by healthcare professionals’ receipt of [medical and scientific information] on unapproved or new uses of approved or cleared medical products that are truthful and not misleading.FDA Draft Guidance at 3-4 (emphasis added).
Lost in all the brouhaha is how limited the FDA’s relaxation of off-label promotion restrictions really is. The Agency has not given a green light to all off-label promotion – or even to all truthful off-label promotion, with stringent truthfulness criteria (our preferred position). The relaxation is limited to one thing and one thing only, reprints of “medical journal articles and scientific or medical reference publications” (that is, articles that appear in independent medical journals and in medical textbooks) or what the FDA calls “medical and scientific information” in its draft guidance. That’s it. There’s no FDA go-ahead for anything that a manufacturer itself might put together, however accurate it might be.
And even with respect to this limited category already consisting of inherently the most reputable sources, the FDA has added still more layers of restrictions:
- The editorial board of the publishing organization must select articles on “objective” criteria.
- The editorial board of the publishing organization must use “independent” peer review, and that peer review process must in fact have been followed with respect to the article in question.
- The publishing organization must require “full disclosure of any conflict of interest or biases.”
- The article in question must be from the ordinary publication, and not from any “special supplement.”
- The publication of the article must not be specially funded by the manufacturer.
- If it’s a textbook, it must be generally sold in stores and other places that medical textbooks are normally distributed.
- The article can’t be “written, edited, excerpted, or published specifically for, or at the request of, a. . .manufacturer.”
- Not only the author, but any editors as well, must not have “financial relationship[s] with the manufacturer.”
- The article in question must solely “address adequate and well-controlled clinical investigations that are considered scientifically sound by experts with scientific training and experience.”
- The article in question cannot be “false or misleading” (that’s an FDA term of art).
- The article in question cannot be “inconsistent with the weight of credible evidence derived from adequate and well-controlled clinical investigations.”
- The article in question cannot be “withdrawn by the journal or disclaimed by the author.”
- The article in question cannot “discuss a clinical investigation where FDA has previously informed the company that the clinical investigation is not adequate and well-controlled.”
- The article in question cannot “pose a significant risk to the public health.”
- The article in question cannot be a letter to the editor, a publication abstract, involve a Phase I (very preliminary) clinical trial, or “contain little or no substantive discussion of the relevant investigation or data” – all because such sources are not likely to be reliable.
- The article in question must be distributed in “unabridged” (that is, nothing can be left out) form.
- The article in question must “not be marked, highlighted, summarized, or characterized by the manufacturer.”
- The article in question must “be accompanied by the approved labeling for the drug or medical device.”
- The article in question must “be accompanied by a comprehensive bibliography “of other published material about the product.
- If the conclusions of the article in question have been “called into question” by other published sources, copies of those conflicting sources must also be included.
- The article in question cannot be accompanied by other “information that is promotional in nature” – meaning that it can’t be distributed as part of a sales pitch by a sales representative.
- The article in question must be “accompanied” by a bunch of disclaimers that disclose: (1) that it discusses an off-label use, (2) that it’s being distributed by somebody with a financial “interest” in the product being, (3) any financial ties to the authors of the article (this is in addition to the financial disclosure rules of the journal itself, discussed above), (4) anybody who did provide funding for the article, even if not related to the manufacturer, and (5) any safety risks of the off-label use that aren’t mentioned in the article.
This kind of thing isn’t new. Congress itself authorized companies to distribute this type of material in part of some 1997 legislation (FDAMA §401) that sunseted in September, 2006. But the statutory exception never worked very well, because Congress included an onerous precondition that, in order to distribute such reprints, the manufacturer had to agree to undertake expensive (costing millions of dollars) clinical trials within three years. Almost all the time, that just wasn’t worth it, so the exception wasn’t ever used very much.
All of this leads us to ask, have the critics of the FDA’s proposal even read it?
At the outset we’re talking about the most facially reliable information that there is – independently published scientific articles and medical textbooks. The FDA has surrounded even that information with a forest of restrictions designed to prevent even the possibility of either scientific shenanigans or overreaching by the manufacturer. On top of all that, the articles must be accompanied both by contrary information (if there is any) and by extensive disclaimers.
So what’s the great harm here? We just don’t see it.
Also, is distribution of this type of truthful information under these restrictive conditions something that anybody really thinks the FDA could legally prohibit under the First Amendment?
We rather suspect that the FDA’s critics here are driven by political rather than scientific agendas. They’ve demonized the industry so much in their own minds that they’ve lost all objectivity. Can somebody tell us, please, how dissemination of published peer-reviewed scientific articles or textbooks under these restrictive conditions is likely to mislead anybody?
Put it another way. Would the FDA’s critics be willing to accept the same restrictions that the FDA is imposing here with respect to medical claims made in attorney advertising?
We didn’t think so.
That’s point one.
Point two is the First Amendment.
Does either the FDA or its critics really believe that public dissemination of truthful medical information, with all these safeguards imposed by the FDA (and given the FDA’s statement of policy), can be prohibited consistently with the First Amendment?
This accuracy of this information is far more assured than the liquor and casino ads that the Supreme Court has found constitutionally protected from governmental bans in 44 Liquormart and Greater New Orleans Broadcasting Ass’n v. United States, 527 U.S. 173 (1999). Indeed, the accuracy of this information is far better protected than the pharmacy compounding advertisements that the FDA was told it could not constitutionally prohibit in Thompson v. Western States Medical Center, 535 U.S. 357 (2002).
We’re tempted to say to the FDA’s critics “Go ahead, make my day.” That is, if you defeat the FDA’s proposal, fine. The legal prohibitions the critics wish to retain would provide just about the best test case possible for a full-blown First Amendment challenge to FDA restrictions on truthful promotion of off-label use generally. Maybe such a First Amendment challenge could even be raised through an administrative appeal of the fate of this proposal (we leave that to the administrative law types out there – which we aren’t – to parse through).
And a very recent legal event that one of us was involved with only cements our view.
Yesterday the Seventh Circuit addressed a First Amendment challenge to a government prosecution for off-label promotion on really bad facts – light years away from the FDA’s proposal – in Caputo v. United States, copy available here. As we mentioned before, Bexis filed an amicus brief on First Amendment issues for the Washington Legal Foundation in Caputo, due to the trial court’s adverse ruling on the First Amendment. Bexis was attempting, quite frankly, to limit the damage to the industry’s First Amendment arguments that an off-label promotion test case chosen by the FDA might have. In that he was successful.
How bad were the facts in Caputo for a First Amendment challenge? Well, here’s how the court described them:
[Defendant company] submitted the small [device] for approval. . . . It also submitted only those tests that favored the device’s effectiveness; others, less helpful. . .were concealed. . . . [Defendant company] understood that [it] would never be able to sell a single unit of the small [device] for the limited use approved by the FDA, [and]. . . did not try. Instead [all defendants] immediately began promoting the large [device] as a replacement for [other] devices, and thus as suitable for general-purpose sterilization. . . . [L]ong before receiving the FDA’s approval to sell the small [device], [defendants] knew that the small device would never be marketed and that the large [device] would be promoted for use with many kinds of instruments – though [defendnts] did not tell the FDA these things. . . .Slip op. at 2-4. If we were representing the government, that’s just the kind of case we’d look for to make arguments that the First Amendment doesn’t protect off-label promotion. And that’s what the government did.
[T]he FDA found out what [defendant company] was telling customers and reminded it about the limitations on the scope of approval. . . . [Defendants] then sought the FDA’s approval to sell the large [device] to sterilize a wider class of instruments; when the FDA rejected [defendants’] request. . .[defendants] went on promoting the large [device] as before. . . . The agency never authorized [defendants] to sell the large [device] for any use.
There are even more bad facts, read them in the opinion if you want, but what we’ve quoted is quite enough for our purposes. These defendants did a lot of things that richly deserved prosecution. But, as the court commented, when the government eventually “threw the book at” the defendants, id. at 5, it not only charged them with all kinds of false and fraudulent things, but also sought to hold them criminally liable for a few truthful statements that (so the government charged at trial) also promoted off-label use. Id. at 5.
Even on this horrific set of facts – shot through with misconduct that nobody would claim the First Amendment protects – the First Amendment argument gave the Seventh Circuit much pause:
[I]n Virginia Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748 (1976), [the court] h[e]ld that the government cannot regulate by ensuring ignorance among consumers. If it is lawful to sell a product then, the Court held, it must be lawful to inform consumers that the product is available to buy. Consumers themselves must decide what to do; the Constitution forecloses an enforced ignorance based on a paternalistic view that informed consumers will make mistakes. See also, e.g., Greater New Orleans Broadcasting Ass’n, Inc. v. United States, 527 U.S. 173 (1999); Rubin v. Coors Brewing Co., 514 U.S. 476 (1995); Bolger v. Youngs Drug Products Corp., 463 U.S. 60 (1983); R.H. Coase, Advertising and Free Speech, 6 J. Legal Studies 1 (1977).
For a time judges thought the Supreme Court’s new understanding inapplicable to drugs (and, by implication, medical devices): Federal law allows vendors to tell customers about all lawfully available drugs and devices, after all, and thus avoids the precise problem presented by Virginia Citizens Consumer Council. But federal law does prohibit manufacturers from alerting consumers to lawful off-label uses, and Thompson v. Western States Medical Center, 535 U.S. 357 (2002), held that this limit is unconstitutional in at least some applications. A federal law allowed pharmacists to compound some drugs that had been approved for stand-alone sales, creating substances that had not been subjected to the normal testing. The legislation granting pharmacists this compounding privilege attached conditions to the way they could promote the compounded drugs. The Court held these limits unconstitutional: if the compounded drug could be sold, the Court held, then it could be freely promoted for every lawful use. Western States Medical Center establishes that drugs are not a special case for first-amendment analysis. . . . The Court suggested in Western States Medical that Congress either adopt a substantive rule prohibiting compounding (or, here, prohibiting off-label uses) or allow the FDA to supply warnings via its own speech. Compelling private persons to toe the government’s line, or shut up, is unconstitutional, the Court held. This is the doctrine that [defendants] propose to invoke in their defense.
Caputo, slip op. at 5-7 (emphasis added). That’s the First Amendment argument in a nutshell – FDA regulation is not a “special case” under the First Amendment, and truthful off-label promotion is protected commercial speech that cannot be prohibited consistently with Western States Medical.
The court in Caupto – even with really bad facts before it – only affirmed the convictions by holding, (1) that there really wasn’t off-label promotion at all, and (2) that the instructions given the jury did not in fact permit conviction for truthful promotion, but only for the fraud that the government claimed (and the jury found) had been committed. The court recognized the vulnerability of the FDA’s ban on truthful off-label promotion under the doctrine of “unconstitutional conditions”:
Whether Virginia Citizens Consumer Council and Western States Medical Center apply to promotion by a product’s manufacturer, which struck a bargain with the FDA in the approval process by promising to limit its promotion – a bargain that the private litigants in the earlier cases had not struck – is a difficult question. The doctrine of unconstitutional conditions places limits on the promises that an agency may extract from those who seek approval. And if a given use is lawful, and thus can be written about freely in newspapers or blogs, and discussed among hospitals that already have purchased [the defendants’ product], doesn’t it make a good deal of sense to allow speech by the device’s manufacturer, which after all will have the best information? Why privilege speech by the uninformed? The manufacturer has an incentive to slant the speech in its favor and may withhold bad news, but many listeners (especially professionals such as physicians) understand this and can discount appropriately. That, at any rate, is the anti-paternalist view of Virginia Citizens Consumer Council and the cases that followed in its wake.Caputo, slip op. at 7 (emphasis added).
The Caputo court recognized that there were other, more restrictive alternatives not involving speech that the FDA could employ if its speech-related restrictions against off-label promotion were declared unconstitutional:
Yet if a manufacturer’s promise to the FDA to avoid speech about off-label uses is unenforceable, the FDA may respond by withholding any approval of drugs or devices that have questionable additional uses. . . . Other firms, with no desire to promote off-label uses (or, at least, no desire to pay for the expensive tests needed to persuade the FDA to sanction wider use), would be made worse off by their inability to strike deals allowing the FDA to approve a subset of all possible uses. Consumers who could benefit from drugs or devices that would be excluded from the market by the FDA’s response to a broad privilege to tout off-label uses also would be made worse off. Doubtless the first amendment differs from Bentham’s felicific calculus [it’s Easterbrook, after all], but a court should hesitate before extending an a historical reading of the Constitution in a way that injures the very audience that is supposed to benefit from free speech.Caputo, slip op. at 7-8 (emphasis added). These are tough questions, as we recognize. If the FDA cannot ban truthful speech, it could do something non-speech related that is actually more restrictive of off-label use – the Agency could, for example (as Bexis mentioned in his brief):
require separate reporting and labeling of adverse events associated with off-label use to alert physicians specifically about off-label risks, where they exist. The Agency could also increase incentives for manufacturers to seek approval for off-label uses through any number of indirect economic means. The government could provide tax incentives for clinical research related to bringing off-label uses onto the label. It could provide manufacturers with a preemption defense in product liability cases involving off-label uses brought onto the label. Products with few off-label uses could receive faster and easier export authorization. Another approach would be to extend or reduce patent exclusivity depending upon the prevalence of off-label use.WLF brief, Caputo, at 30.
Not wanting, either, to reject First Amendment protection that Supreme Court decisions had conferred upon truthful commercial speech, or alternatively, to let these defendants off the hook, the Caputo court ultimately avoided deciding the issue (“Fortunately, we need not decide today whether a seller of drugs or medical devices has a constitutional right to promote off-label uses. Caputo, slip op. at 8) – by finding (1) no off-label use and (2) no conviction for truthful promotion.
As to the first, the court concluded that the FDA never approved the device the defendants actually sold for anything. “Unless the machine itself could be sold lawfully, there were no lawful off-label uses to promote. And the jury found, by its verdicts on both the fraud-on-the-United-States count and the misbranded-device counts, that the large [device] could not lawfully be sold.” Caputo, slip op. at 8. No approved label – ergo no legal off-label uses (or promotion of same) were possible. See also Id. at 9 (additional discussion of unapproved device issues).
As to the second, the court held that the jury instructions in fact required a finding of fraud as a predicate for conviction, and thus the defendants could not have been convicted for truthful off-label promotion. “Defendants insisted at oral argument that the jury could have convicted, under the instructions given, without finding either lies to the FDA or sale of a never approved device. We have reviewed the instructions and conclude that, to convict on all counts as it did, the jury had to find both.” Caputo, slip op. at 8-9.
In Caputo the Seventh Circuit thus took care to recognize the strength of the First Amendment argument for protection of truthful off-label promotion even in the context of facts that the government charged, and a jury found, proved a fraud committed against both the government and the public. In light of Caputo - and the line of Supreme Court First Amendment cases that (to date) culminate with the Western States finding that FDA prohibitions (like the rest of the government’s) cannot transgress the bounds of constitutionality - is it any surprise that the FDA has given ground on off-label promotion involving indisputably truthful, peer-reviewed articles and textbooks?
We don’t think so.
We think that the FDA issued its latest guidance on off-label promotion not for any nefarious reasons, but because it sees the handwriting on the wall the same as we do. The FDA is proposing to confirm the legality of truthful off-label promotion that it has no constitutional power to prohibit in the first place. It’s a long overdue baby step by the Agency in the direction of constitutionality. The FDA isn’t stupid. It knows that there are just some legal battles that are hopeless, and thus not worth fighting.
If the FDA’s critics stopped to think about it, maybe they’d agree too. But if the other side wants to fight the constitutional battle over off-label promotion on turf that the FDA’s willing to concede in its proposed guideline, we’re happy to fly the First Amendment flag on that battlefield.
First the good news: We're pleased to report that we've had more than 25,000 pageviews in the last thirty days -- a new high for us. Thanks very much for your interest.
Now the bad news: We see some of you flailing around on the web, trying to find us by word searches of our names, but spelling our names incorrectly.
Take a deep breath.
Here are some key words that we're now typing into this blog, so that folks can find us, despite the usual errors: James Beck, James M. Beck, James C. Beck, Jim Beck, Bexis, Mark Herrmann, Marc Herrmann, Mark Herman, Mark Herrman, Mark Hermann. We probably should throw in some more variations, too, but it's just too painful.
We sure do appreciate your taking the time to look. And now it should be just a little easier to find us.
Back to drugs and devices with a substantive post shortly.
Wednesday, February 27, 2008
For those who may be interested, but were previously unaware of this service, here's a link to the registration page. (Don't worry; it's easy. Even the two of us, blogging luddites that we are, have managed to sign up.)
Tuesday, February 26, 2008
The Independence County claims involved FDA-approved drugs (OTC cold remedies) marketed for FDA-approved uses. Apparently, though, the active ingredients in these products are used by criminals to make methamphetamine ("speed"). In what has to be one of the most blatant examples of state law being used to attack marketing that the FDA considers legal, the lawyer loaned use of the county's name charged that, because of the likelihood of third-party criminal product misuse, FDA approved OTC marketing violates the state's (Arkansas) consumer protection statutes and also constitutes a public nuisance.
And you wonder why federal preemption is such a hot topic?
The consumer fraud claim was dismissed on the quite logical ground that, because the product was sold in accordance with FDA approval, and was only misused after sale by criminals, there was no unconscionable "trade practice" by the defendant:
The [FDA] approved pseudoephedrine as an active ingredient in cold and cough remedies for over the counter human use. The FDA regulates the labeling of nasal decongestants, including dosage warnings. The [DEA] regulates manufacturers and distributors of products containing pseudoephedrine. Plaintiffs did not allege that Defendants' actions violated any federal regulation in connection with the labeling or distribution of their products, or that Defendants' actions violated Arkansas laws regulating who can possess and sell [these] products.... Plaintiffs' allegation ... is that it is unconscionable to produce and distribute medicine containing ephedrine and pseudoephedrine-that but-for Defendants' products, methamphetamine production and use would be sharply reduced. Nothing in the record shows that Defendants' trade practices are unconscionable, and the application of the ADTPA is limited to trade practice.
2008 WL 398980, at *2. The consumer fraud claim was also dismissed - as these pseudo-suits farmed out by local governments to private attorneys often are - on the ground that the purported injuries are too "remote" by virtue of intervening third-party criminality. Id. at *3.
But what caught our eye even more was the inclusion of a public nuisance allegation. Id. at *4. That claim got short shrift in the opinion because, under Arkansas law, public nuisance is limited to conduct involving ownership of land.
Independence County is the first reported case that we know of alleging that lawful distribution of an FDA-approved product is a "public nuisance." We've already encountered this type of claim in other products cases (we've also represented alcohol, tobacco, and firearms manufacturers), so we already have a post describing several defenses to product-related public nuisance that we've found useful. But in the prescription drug area our primary reaction to the notion of public nuisance is very simple.
Public nuisance claims involving FDA-approved products are preempted - period.
There's an inherent and unavoidable conflict between the FDA imposing the conditions under which the products it approves may be marketed and a state saying that, when marketed in accordance with those conditions, the product constitutes a nuisance to the public. The conflict is total and absolute - "impossibility" preemption of the most fundamental sort. Shades of McDermott v. Wisconsin, 228 U.S. 115, 137 (1913), where a state purported to "forbid" the use of FDA-approved labeling.
Fraud on the FDA is preempted, most fundamentally, because there is an inherent conflict between an in-force FDA decision, and any state law cause of action that tells a jury, in effect, that it can ignore that FDA decision because it was improperly obtained. A unanimous court found preemption in Buckman, and at the Kent oral argment, that essential consensus did not appear much changed. The debate in Kent was primarily over how much further - towards the concept of FDA compliance as a general defense - the Buckman principle could, or should, be extended.
Well, public nuisance presents a worse conflict than even claims of administrative fraud. Public nuisance doesn't even come with the fig leaf of claimed improprieties in the FDA decision process. Public nuisance alleges that, taking the FDA's marketing approval on its face, the conduct that the agency has authorized is a "nuisance" under state law and can be enjoined. It's hard to get a more direct conflict than that.
The more preemption decisions we can get in the prescription medical product context, the happier we are. Such decisions help "settle" the law. If plaintiffs (whether "governmental" or private) wish to bring the misbegotten public nuisance concept into the FDA's bailiwick, we'll be ready.
But then we saw how the case brought out the best in one plaintiff's lawyer. So that got us to thinking.
Back in the 1950s and '60s, Tom Lehrer wrote an awful lot of riotously funny songs. (For example: "The Lord's our shepherd, says the Psalm; but just in case, we'd better get a bomb.") According to the urban legend, Lehrer gave up his calling when Henry Kissinger received the Nobel Peace Prize. Lehrer insisted that awarding the Nobel Peace Prize to Henry Kissinger made political satire obsolete.
What are we ranting about here?
We've decided that the Supreme Court's decision in Riegel similarly made our "Device Preemption Scorecard" (over in the right-hand column of this blog) obsolete. We now know the answers to the two big questions: There's typically no preemption for devices approved through the 510(k) process, and there typically is preemption for devices approved through premarket approval. We suspect it'll be a mighty long time before the Court takes a case involving "investigational device" or "product development protocol" preemption, so we now know all we're likely to hear on this subject.
We're going to leave the "Device Preemption Scorecard" in existence for a while (largely for reference purposes; it may help, for example, if someone needs more ammunition than we've already provided to win a case involving a premarket approval supplement). But we won't be updating the Scorecard any more.
Depending on how the case law starts to break, we just may start an "Alleged FDA Noncompliance Scorecard." Given the holding in Riegel, we have the creeping suspicion that the plaintiffs' bar is going to decide that no device manufacturer has ever complied with the FDA regulations, which plaintiffs will insist is the allegation they need to keep their cases alive.
We sure hope law enforcement officials are watching. If those allegations are right, the plaintiffs' bar is about to begin exposing an epidemic of lawlessness that has previously gone unnoticed and unpunished.
Or maybe our analysis is right, and it will be a little tougher to pursue noncompliance claims than the plaintiffs are hoping.
Anyway, the Device Preemption Scorecard is dead; long live whatever succeeds it.
Monday, February 25, 2008
The Warner-Lambert v. Kent argument found several justices troubled about where to draw the Buckman preemption line—but also finds Justice Breyer remarkably critical of pharmaceutical product liability as a whole, suggesting that the respondents' ability to muddy the waters may lead the court to simply preempt broad swaths of pharmaceutical product liability. Throughout the argument, the specter of the Wyeth v. Levine case early next term led both sides to punt hard questions as a matter to be resolved down the road.
Shortly before the argument, Justice Roberts, who is recused, sneaks off. In a nine-justice court, a recusal is indistinguishable from a vote for affirmance (as 4-4 tie votes are affirmed), so the petitioners are already starting a vote down.
Carter Phillips, Sidley Austin, arguing for the petitioner Warner-Lambert, says that policing fraud on federal agencies is something entirely within the federal ambit, and that the Michigan statute is preempted by Buckman.
Scalia asks how far that principle goes: what if there were a tort action alleging conditions of FDA marketing were not met? Phillips punts the question: the petitioners are simply seeking a narrow ruling that Buckman applies. But, Scalia, says, Buckman's cause of action was FDA-specific. Phillips: But juries would be making the same sort of determinations that Buckman held impermissible.
Ginsburg (who perhaps tips her hand when she refers to the petitioner as a "drug dealer") asks isn't the Michigan statute just an "invigorated" version of the regulatory compliance defense? Stevens: what if there is no statute, just the regulatory compliance defense, rebutted by the plaintiffs with a claim of fraud. Phillips, yes, the plaintiffs would be preempted from making such an argument to the jury if regulatory authority is implicated.
Stevens questions the premises of Buckman: what is the evidence of burden to the government? Phillips: Buckman held that we don't wait until there is serious interference with the agency, we step in in advance. Stevens asks about the bribery exception to the Michigan statute. Phillips says that that is not pre-empted. Later, Daryl Joseffer, arguing for the government, argues that it is pre-empted.
Stevens: If this goes to litigation, what happens? Don't the plaintiffs have the burden of proving their case? Phillips: Yes, and the FDA didn't withdraw the drug. But there is still the problem of state courts pulling on federal prerogatives if that is litigated.
Daryl Joseffer, SG's office, argues for the government. (And if you want to feel old, watch the oral argument of someone in a frock coat whom you supervised when he was a brand new associate taking his first deposition.) Souter takes up Ginsburg's question: is there the same issue if regulatory compliance is a defense? Joseffer: it depends on whether it implicates federal interest and asks the jury to second-guess the regulatory decision. Preemption applies only to legal theories, not evidence. Souter: so your objection is to the plaintiffs being required to prove but-for withdrawal? Joseffer: not just that. It's the second-guessing of the approval process. Souter: But why isn't that the same as the compliance defense? Joseffer: if it's a mere matter of evidence, no problem, but questioning product-specific approval decisions. Souter: but under Michigan statute, FDA approval is conclusive. Joseffer: a predicate to liability under the statute is inquiry into the FDA approval process. That's the same thing forbidden under Riegel and under Buckman. Stevens: But besides Buckman, there has always been a regulatory compliance defense. What have courts said in those circumstances? Joseffer: this is a new problem; it's a theory of modern vintage to inquire into specific product approval. Kennedy: what's your strongest case besides Buckman? Joseffer: This is so obviously a federal prerogative that there isn't other precedent here.
A good chunk of the arguments were taken up with back-and-forth between Ginsburg and Scalia on the question of severability and how to interpret Michigan law. Joseffer says the US has no position on the state law question, but notes that the Garcia decision in the Sixth came about because plaintiffs asked for preemption of the entire statute; on rebuttal, Phillips argues that the Court should defer to the Sixth Circuit's findings on Michigan state law (and the Second Circuit's deferral to the Sixth Circuit), but acknowledges that a state supreme court certification on the severability question is possible. But he disagrees with Ginsburg's premise that there was no bitter with the sweet: if the FDA does make the findings of fraud and withdraws a drug, a cause of action is possible under Michigan law, and that is a reasonable reading of the statute. Ginsburg argues that the legislature wouldn't have agreed to that bargain.
Allison Zieve, Public Citizen, for respondent plaintiffs: the misrepresentation exception to the Michigan statute does not implicate Buckman. There is no reason to fear, as Buckman did, that companies would oversubmit evidence to the FDA, because they are required to submit "all available information" about adverse events.
Kennedy: but wouldn't discovery be intrusive upon the FDA? Zieve: No, because discovery would be the same as a typical product liability case.
This sets Justice Breyer off on a long speech: Why isn't that worse? You're alleging that the drugs have side-effects that hurt people. But there is a risk on the other side, the loss of the drug that can help people. On balance, is the drug going to save lives or cost lives? Who should make that decision? The FDA, or a jury of twelve people that sees only the hurt people? That is a decision for Congress, and Buckman holds that Congress said the agency decides. (Scalia smiles at this.)
Zieve tries to disagree: product liability simply compensates injured patients, and thus complements FDA regulation. We're not seeking a regulatory remedy, just compensation. Kennedy: but your premise is that the drug should not have been sold. Zieve, in response, picks up on Ginsburg's "invigorated defense" argument: the Michigan statute simply holds that approval is reliable evidence of duty. If a company lied to or bribed the FDA, then approval is no longer reliable. The statute doesn't police the FDA enforcement, or take a drug off the market, just decides whether plaintiff can get damages like in the other states. Kennedy: but the jury will have to decide the drug should have been off the market. Zieve: Yes, in Michigan, we'll have to show that, though we think we can. Stevens: could you still lose if the exception applies? Zieve: Yes. We'd have to go through the same process as Rezulin litigation throughout the rest of the country. There is already a lot of discovery done of Warner-Lambert and the FDA.
Alito: Is the government wrong that having a jury second-guess approval interferes with the regulatory mission? Zieve: In this case there is no interference, because the drug is off the market. But even as a general matter, there's no interference, because the effect of making a showing in court has no regulatory effect. It's the same as any other state tort litigation, which doesn't police regulatory compliance either. Alito: But wouldn't discovery into the internal decisionmaking of the FDA be problematic? Zieve: Plaintiffs seek that now, but Michigan courts can be trusted to control it. Alito: What evidence would you need to prove exception? Ginsburg: Does it obstruct the FDA to take their depositions? Zieve: No more so than in any other state. Rezulin discovery was negotiated with the FDA, including deposition of the medical officer. Vioxx discovery was contested, and the MDL ordered discovery. Other cases, the FDA successfully blocks discovery. There's no evidence it is a burden on the agency or judges are overwhelming the FDA.
Scalia asks if there can be a distinction between drugs on the market and off the market; after all, if it is on the market, the FDA has incentive to retrospectively review the data in a way that it doesn't if it is off the market. Zieve: But all the FDA could do then is to sanction the manufacturer. Scalia: Wouldn't that solve your problem? You then get to show the exception applies. Zieve: But we can't force the FDA to make a finding, and the FDA finding doesn't get us compensation.
Breyer: But the drug will be withdrawn. What if a jury is wrong? Who's more likely to be right? He is confused: you mean that it is possible for the FDA to approve use, that the label is okay, the doctor follows the label, and plaintiffs get compensation from the manufacturer for a disclosed side effect? Zieve and Ginsburg answer yes, and Zieve explains that the Michigan statute narrows, rather than expands tort law. Breyer: So you're saying that if the tort system isn't preempted, this isn't preempted.
On rebuttal, Phillips largely takes up the question of the appropriateness of severability. He blunders a bit when he argues that the FDA can order restitution to consumers after a drug is withdrawn and Stevens spanks him noting that that is hardly full remedial compensation for a wrongful death claim. But he closes noting that the FDA has full incentive to go after fraud, even post-withdrawal, and that Public Citizen petitioned the FDA to have Rezulin withdrawn on this sort of evidence, and the FDA rejected the petition.
Defense attorneys may be concerned that Phillips's argument never gave a clear answer to the question of where to place the line between every-day tort law and the Michigan statute and frustrated that he hewed to a narrow line of application of Buckman rather than a larger theory of when preemption was appropriate. Zieve takes the position—which she may regret later in Wyeth—that Michigan is just a special example of state tort law. A number of justices seemed genuinely surprised that it is common in product liability litigation to depose FDA officials about their administrative decisions.
Sunday, February 24, 2008
(Sorry -- we couldn't resist. We just love typing those words.)
Oh, yeah. We were regaling you with tales from the Tulane Law Review Multidistrict Litigation Symposium.
One panel at the Symposium featured Dean Edward Sherman (of Tulane), Judge Stanwood Duval (of the Eastern District of Louisiana), and Professor Robin Effron (of Brooklyn Law School). The topic was one that we hadn't really focused on before; heck, it was one that we'd never even heard of before -- "event jurisdiction." Event jurisdiction is the name Professor Effron has coined for statutes or orders that place before a single judge all lawsuits that arise out of a single event. Neither of the "events" discussed at Tulane has anything to do with drug or device law, but they both involved mass disasters and attempts to resolve complex litigation, so we figure we can post about them on this blog.
(And, hey, it's our blog, anyway. We figure that if some oddball thing strikes our fancy, we have every right to inflict on you our ruminations on the subjet.)
We really had only one point to make, and we'll keep it quick.
The first of the two "events" that this panel discussed was Hurricane Katrina.
On September 19, 2005, plaintifs filed the first of the lawsuits alleging water damage as a result of the breaches or overtopping of levees in the aftermath of Hurricane Katrina. That case was transferred to Judge Duval on February 23, 2006. The en banc court of the Eastern District of Louisiana later decided to consolidate all of the cases related to the failed levees to Judge Duval to avoid conflicting decisions among the various sections of the court. What is now captioned "In re: Katrina Canal Breaches Consolidated Litigation," C.A. No. 05-4182, became the umbrella for all cases that concern damages caused by flooding as a result of breaches or overtopping in the areas of the 17th Street Canal, the London Avenue Canal, the Industrial Canal, and the Mississippi Gulf River Outlet.
This litigation involves claims for property damage, claims for insurance coverage, claims against the Army Corps of Engineers and state and local agencies that responded to the Hurricane, at least one lawsuit filed by the Louisiana Attorney General, and many others. This is thus litigation that is probably too unrelated to be centralized by the Judicial Panel on Multidistrict Litigation, even though all of the cases relate in some way to the common issue of "levee breaches."
It sounds logical, and perhaps it is, to consolidate these cases for pretrial discovery and motion practice, but Judge Duval candidly acknowledged that the scope of the litigation has become far broader than anyone originally anticipated. Before Katrina, the average judge in the Eastern District of Louisiana was handling between 225 and 250 cases; there are now 1600 cases per judge in Judge Duval's section. And describing some of these matters as mere "cases" doesn't really do them justice. For example, 350,000 claims against the government have been joined in a single complaint. You can call that one "case" if you like, but it seems like an understatement.
Professor Effron discussed another example of what she calls "event jurisdiction." We quote here from the SSRN description of Professor Effron's law review article describing the consolidation of the litigation arising from the terrorist attacks of September 11, 2001:
"Shortly after the tragic events of September 11, 2001, Congress passed the Air Transportation Safety and System Stabilization Act (ATSSSA). The September 11th Victim Compensation Fund (VCF) was the centerpiece of the statute and provided a source of no-fault compensation to the tragedy's victims and victims' families. The ATSSSA also allowed victims to elect to pursue traditional litigation instead. The ATSSSA contains three jurisdictional features that have shaped the path of the litigation. The Act created a federal cause of action 'for damages arising out of' the terrorist related aircraft crashes; it gave the Southern District of New York original and exclusive jurisdiction over all actions 'resulting from or relating to the terrorist-related aircraft crashes.' Finally, it implemented a liability cap by limiting recovery in all actions to the defendants' available liability insurance."
The lesson from the 9/11 litigation was the same as that of the Katrina litigation. Over time, more and more plaintiffs, with claims more and more distant from the central events of 9/11, filed lawsuits. Workers who were on the scene on September 12 were later joined by workers on the scene much later, workers further from the scene, and so on. The litigation has thus grown beyond what Congress originally intended and has posed unique administrative difficulties.
If there's a lesson to be learned here, it's that courts and legislators cannot easily predict the precise scope of litigation that will grow out of a seemingly localized disaster. Statutes or orders consolidating these cases must provide judges with enough resources, and leave judges with enough discretion, to ensure that claims can be resolved -- either within the designated "event court" or without -- fairly and efficiently.
Friday, February 22, 2008
So here's a warm welcome to the Times' readers. Look around. And prepare for cognitive dissonance, as the positions stated in this blog are nothing like those you've been accustomed to reading.
Oh, and about the article, the Supreme Court didn't think it mattered in Riegel, but that case in fact also involved a PMA supplement product - just like the Fidelis lead litigation that the article discusses. You just have to look to the Second Circuit's opinion, Riegel v. Medtronic, Inc., 451 F.3d 104, 120, 132 (2d Cir. 2006) (pages mentioning supplement), aff’d, 2008 WL 440744 (U.S. Feb. 22, 2008), to find that out.
For those interested in the preemption track record of PMA supplement (and other PMA equivalent) devices, look here.
About the Supreme Court:
Plaintiffs' lawyers need to look in the mirror. The Riegel case involved a product put to a contraindicated use (calcified arteries) and then misused (overinflated) on top of that. Yet it was the manufacturer that was sued. Why? It was a suit that should never have been brought (at least against Medtronic), but the plaintiffs' side appealed it all the way to the Supreme Court. That's spelled h-u-b-r-i-s.
And then there's the whole mass tort industry, which we parodied in Anatomy of a Mass Tort. Nowadays, if there's recall, a warning letter, or practically any other other adverse information of any sort about a prescription drug or medical device, within a week there've been ten class actions filed and a massive plaintiff solicitation campaign going on. It's so predictable and blatantly extortionate that it would be humorous, if it weren't for all the time, effort, and money defendants are forced to spend defending against the mass tort of the week.
The tort system has gotten out of control. For one thing, it's tried to usurp the role of the FDA. It's not surprising to see courts looking for ways to rein it in.
The plaintiff's side should stop criticizing Justice Scalia as if he were some sort of traitor. Plaintiffs never had Justice Scalia on preemption, but he's no knee jerk vote for our side either. He's kicked us in the teeth regularly on punitive damages. Justice Scalia has been a tort preemptionist of longstanding. He wasn't what caused the plaintiff's side to lose Riegel.
Again, a little mirror viewing is in order. As recently as Lohr - as recently as Bates - five justices voted against (most) preemption. The plaintiffs' side lost four of those five in Riegel. That should say something. Plaintiffs appealed a lousy case all the way to the Supreme Court. They made some bad and extreme arguments, some of which been rejected by the Court several times before. But most importantly, the plaintiffs were trying to seize for themselves the FDA's power to determine how devices (and drugs, but that's Levine) are designed and what their labels would say. It's not suprising that the FDA would oppose that.
The plaintiffs' side should take a long hard look at the facts in Levine. Quite frankly, you're doing it again - bad facts, bad arguments, and trying to usurp the FDA's authority over drug labeling.
About the FDA:
We've had several comments calling the FDA a "joke" or something similar and mentioning (even attaching excerpts from) the recent advisory committee report commissioned by the FDA that is critical of a number (quite a few, actually) of the Agency's shortcomings.
It's easy to criticize, but it's a lot harder to try to make things better. Perhaps it's just the way the other side thinks - since second-guessing and criticizing defendants is the plaintiffs' stock in trade - but we can't think of anything the other side has ever actually done to try to improve the operation of the FDA. The Agency is no joke. Like it or not, it's the entity that Congress has charged with overseeing the safety of drugs, medical devices, food, vaccines, and a lot of other stuff that keeps us alive and functioning.
The FDA only becomes a "joke" if Congress refuses to adequately fund it and otherwise fails to provide it with the authority and tools it needs to do the job - and if the administration fails to provide the leadership and will for the Agency to do its job (compare FEMA under the last two administrations). Even during the love-in that the plaintiff's side had with the FDA under former Commissioner Kessler (amazingly, a Republican appointee), they did nothing to strengthen the Agency. All of the recent legislation that has provided additional funding sources and statutory authority for the Agency - FDAMA, user fees, and FDAAA - have been pushed by industry and either ignored, or actively sabotaged, by the other side of the "v".
Industry even agreed to tax itself for the benefit of the FDA (something we've never seen lawyers do - the bar vehemently opposes any taxes on legal fees), but still the plaintiffs' side carps. We've seen their hired experts come into court and call the FDA's user fee program some sort of conflict of interest. The committee report says the FDA needs more money. That's true. Well where's that money going to come from? Industry has stepped up to the plate; the other side contents itself with throwing bottles from the stands.
So you'll get your name in lights on the most-read products liability blog on the Internet.
That and a five bucks might get you a cup of coffee at Starbucks (we're old enough to remember when the operative amount for that joke was a dime).
Anyone hard core enough to take us up on this offer can contact either (or both) of us by email.
Thursday, February 21, 2008
One of us even got almost hilariously misquoted in the press, when the reporter got the effect of the 2006 Preemption Preamble exactly backwards. As everyone reading this knows, in 2006 the FDA invigorated – not impeded – preemption.
But it’s time to face the cold, gray dawn.
The medical device industry, or at least the most innovative part of it, received major relief from product liability litigation yesterday in Riegel v. Medtronic (now online at 2008 WL 440744). As long as our clients with PMA-approved devices comply with federal law, they’re not going to be subject to much in the way of product liability. Not only that, as we pointed out only two weeks ago, so-called “parallel” (or “violation”) claims have their own conceptual problems, given the exclusive grant of enforcement authority to the FDA.
That’s not what we’re talking about right now, though. We’re stone, cold sober.
We won. What does that mean? At bottom, it means that, just as Riegel gives some of our clients the opportunity for a more litigation-free existence, that increased freedom carries with it a correspondingly increased responsibility.
Plaintiffs lawyers like to say (at least when they’re not piously denying the “regulatory effect” of tort law in briefs opposing preemption) that product liability litigation serves as an incentive to make safer products.
We defense lawyers retort that product liability litigation is horribly ineffective (given the influence of so many non-merits issues), inefficient (plaintiffs’ lawyers take 33% or more of most recoveries, and that’s not even counting defense costs), and downright counterproductive (deterring innovation, and punishing manufacturers for doing the right thing when they discover problems) compared to governmental regulation as a means of ensuring product safety.
Well, now we’re going to find out who’s really right.
In other words, the PMA medical device field is going to determine in practice whether a high regulation, low litigation environment is as effective a method of ensuring the safety of the public as we think it is – or if it’s as lousy a way of ensuring safe medical devices as the other side claims.
So, to the medical device industry – to the regulators at the FDA – and to our colleagues who practice FDCA regulatory law…. Don’t let us down, please.
We product liability defense lawyers are likely to be shuffling mostly off the PMA-approved stage – shooing our opponents along with us. That’s what we want. Good defense lawyers go out there every day trying to find ways to put ourselves out of a job. That’s what we’re supposed to do – find ways that our clients will have less need for our services. On the morning after, that looks like that’s finally happened with PMA medical devices. We wish those clients well, confident that there will always be a market for good lawyers.
But we know that this result will last only as long as the replacement system is effective at keeping the public safe.
That’s the bottom line. We expect even our opponents would agree with us on that.
Our clients are good, dedicated people. We know that, whether the other side wants to believe it or not. The medical devices that they’ve invented, well, some of them are little short of miraculous in what they can do. But they’re not perfect. Nothing and nobody is. Even when mistakes happen, we’ve seen our clients do the right thing over and over again, even though the prior system virtually guaranteed that they’d face major litigation as a result.
We fully expect them to continue doing the right thing, even with the threat of litigation substantially reduced. If they don’t – if they were to cut corners, fall down on their reporting and compliance, and so on – then the high regulation, low litigation model that Riegel is giving a chance to function isn’t going to work.
In this sense, Riegel presents a challenge to all of us who believe that free market capitalism – properly regulated – is the best economic system ever put into practice.
And this is not just a challenge for industry. Ditto the regulators. Riegel confers added responsibility on the FDA. The Agency has stated over and over again that it – not courts and lawyers – has primary responsibility for ensuring that the products it regulates are safe and effective. The FDA, like industry, now has to put up or shut up. With much of the litigation underbrush cleared away, the FDA will have to show that it is indeed the expert regulatory body that we believe it is. In short, it will have to exercise effective authority over PMA medical devices.
“Oops, we inspected the wrong facility,” isn’t going to cut it.
The FDA will have to display, day in and day out, the “rigor” that the Riegel majority found in its approval and post-approval processes. If the Agency doesn’t provide strong regulatory oversight, then inevitably unsafe medical devices will enter the market and people – real flesh and blood people – are going to get hurt. So we expect the FDA to reject such devices, even though in specific instances this will cost companies a lot of money. We expect the FDA to come down like a ton of bricks on anybody who cheats on safety-related issues after approval, such as not reporting adverse incidents, or not following good manufacturing practices.
If the Agency doesn’t do this, the high regulation, low litigation model isn’t going to work.
The same holds true for our colleagues on the regulatory side. We expect them, as we expect ourselves, to represent the interests of their clients. But when they find, as they inevitably will, flaws in the system, they need – through organizations like the Food and Drug Law Institute – to work with the FDA to correct those flaws so that the Agency’s processes effectively protect the public. If our regulatory colleagues concentrate on gaming the system rather than ensuring its effectiveness, once again the high regulation, low litigation model won’t work.
And if this model doesn’t work, it won’t last.
Remember, it’s express preemption that was at issue in Riegel. That means that the protection from suit provided by the Riegel preemption holding is based upon the terms of the FDCA Act. The statute can be changed by Congress. Indeed, we fully expect the other side to try to strangle the high regulation, low litigation model in its crib. After all, they stand to lose their 30%+ cut.
However, we expect them to be unsuccessful – as long as the public health is properly protected.
We expect the other side to fail because we’re convinced that FDA regulation is a far superior means of ensuring the public health. We believe that the methodical and systematic decisions of an expert agency are far more likely to produce rational results conducive to product safety than the uncoordinated decisions of innumerable juries – which are influenced by every inflammatory trick that lawyers can play, apply a patchwork of inconsistent state law, and aren’t allowed to focus on anything more than the case in front of them.
If we didn’t believe this, we couldn’t do what we do.
But if we’re wrong (there’s only one guy on the planet who claims infallibility), and the high regulation, low litigation model results in a lot of substandard devices that hurt people, then Congress will change the law, and we’ll be back to litigation as usual.
Worse than that actually.
If the high regulation, low litigation model can’t deliver the goods, then its failure will discredit the medical device industry, discredit the FDA, and discredit us lawyers who represent the industry. If that happens, we’ll be worse off than we were before Riegel.
And that would be a very bad thing.
Wednesday, February 20, 2008
He thinks there may be a silver lining for drug defendants in Justice Ginsbeg's anti-preemption dissent.
Justice Ginsberg, the lone dissenter in Riegel, had a lot of relevant things to say about preemption in the prescription drug context. The surprise is that a lot of it was very good for defendants.
It is admittedly difficult to believe that Justice Ginsberg would someday find that FDA’s prescription drug regulations broadly preempt state law when she refused to find broad preemption in the device context, where there was an express preemption clause. Indeed, the basis of Justice Ginsberg’s dissent was her claim that preemption had been historically rejected in the prescription drug context, and therefore, Congress must not have intended broad preemption in the device context either. In that context, Justice Ginsberg reports that courts considering the question have “overwhelmingly held that FDA approval of a new drug application does not preempt state tort suits,” citing a list of cases very familiar to readers of this blog, and she concluded that “[d]ecades of drug regulation thus indicate…that Congress did not regard FDA regulation and state tort claims as mutually exclusive.” None of this sounded very promising.
But then things got much better real fast. Justice Ginsberg says that her opinion “would hardly render the FDA’s premarket approval…irrelevant to the instant suit.” That’s good news. Then she asserts that her rejection of broad preemption, of the kind found by the majority, “does not foreclose (through negative implication) any possibility of implied conflict preemption.” That’s really good news. Then she acknowledges that a manufacturer “may have a dispositive defense if it can identify an actual conflict between the plaintiff’s theory of the case and the FDA’s premarket approval of the device in question.” That’s great news.
Read that line again. Justice Ginsberg has explicitly recognized the possibility that a plaintiff’s theory of the case can conflict with FDA approval and would be preempted under that circumstance. That position, of course, has been the basis of FDA’s position on the preemption of failure-to-warn claims all along - and what we’ve been telling courts on behalf of our clients. The next step is simply to identify the conflict, and the good news there is that, as the Reigel majority recognized, FDA is entitled to a lot of deference about the interpretation of its own regulations under Auer.
So despite her historical report that courts have generally rejected preemption in the drug context (or, more accurately, found no conflict preemption under the facts of their individual cases), Justice Ginsberg really helps push the conflict preemption argument forward, even acknowledging, in a line sure to be repeated by us forever, that “[t]he process for approving new drugs is at least as rigorous as the premarket approval process for medical devices.”
So if FDA goes through that “rigorous” process and approves warnings as a result, and interprets its own regulations to disallow different warnings under most circumstances, then a plaintiff surely cannot come to court claiming that a drug manufacturer (or a device manufacturer, for that matter), could or should have said something different. Preemption, after all, is not a complicated defense when federal law prohibits you from doing something different.
Reigel is obviously a big win for manufacturers. Whether Justice Ginsberg’s dissent is a hidden “win” remains to be seen, of course, but it should at least put to rest any argument that conflict preemption can never bar a plaintiff’s failure-to-warn claim, and it provides us with a lot more good things to say about preemption until the Supreme Court has its say again.
The 7-1 Riegel decision definitively demolishes a lot of the arguments we've been seeing for years (if not decades) from plaintiffs opposing preemption. In particular:
The PMA process creates "specific counterpart regulations" within the meaning of Medtronic v. Lohr, since the PMA process is concerned precisely with safety and effectiveness. "[P]remarket approval is specific to individual devices. And it is in no sense an exemption from federal safety review—it is federal safety review." Op. at 9 (emphasis original). Unlike Lohr PMA approval "is focused on safety, not equivalence." Id.
Manufacturers are not free simply to change the attributes of their devices after approval. "[T]he FDA requires a device that has received premarket approval to be made with almost no deviations from the specifications in its approval application." Op. at 10.
The majority "adhere[s] to the view" "that common-law causes of action for negligence and strict liability do impose “requirement[s]” and would be pre-empted by federal requirements specific to a medical device." Op. at 10. Not only that, unless there's some specific qualifier, the word "requirement" henceforth in any federal statute will be read to include the common-law, because "Congress is entitled to know what meaning this Court will assign to terms regularly used in its enactments." Op. at 11. So essentially all other statutes using "requirement" in preemption clauses will be found to preempt the common law. That's a big spillover effect.
There's another possible spillover effect - from something that the majority does not mention, either here or anywhere else in its opinion. That's the so-called "presumption against preemption," which is conspicuous by its absence in all but Justice Ginsbert's lone dissent. Since this "presumption" previously arose in express preemption cases such as Cipollone and Lohr, it's utter absence from the analysis of seven justices in Riegel - also express preemption - is telling.
The majority holds that state tort law is less - not more - deserving of protection from preemption than state statutory or regulatory enactments:
[E]xcluding common-law duties from the scope of pre-emption would make little sense. State tort law that requires a manufacturer’s catheters to be safer, but hence less effective, than the model the FDA has approved disrupts the federal scheme no less than state regulatory law to the same effect. Indeed, one would think that tort law, applied by juries under a negligence or strict-liability standard, is less deserving of preservation. A state statute, or a regulation adopted by a state agency, could at least be expected to apply cost-benefit analysis similar to that applied by the experts at the FDA: How many more lives will be saved by a device which, along with its greater effectiveness, brings a greater risk of harm? A jury, on the other hand, sees only the cost of a more dangerous design, and is not concerned with its benefits; the patients who reaped those benefits are not represented in court. As JUSTICE BREYER explained in Lohr, it is implausible that the MDA was meant to “grant greater power (to set state standards ‘different from, or in addition to’ federal standards) to a single state jury than to state officials acting through state administrative or legislative lawmaking processes.” 518 U. S., at 504. That perverse distinction is not required or even suggested by the broad language Congress chose in the MDA, and we will not turn somersaults to create it.
Op. at 11-12 (emphasis gleefully added).
The old saw from Silkwood v. Kerr McGee, that it is “difficult to believe that Congress would, without comment, remove all means of judicial recourse,” by plaintiffs through preemption also takes a big hit. The majority answers the dissent's reliance upon this assertion thusly:
But, as we have explained, this is exactly what a pre-emption clause for medical devices does by its terms. The operation of a law enacted by Congress need not be seconded by a committee report on pain of judicial nullification. It is not our job to speculate upon congressional motives. If we were to do so, however, the only indication available — the text of the statute — suggests that the solicitude for those injured by FDA-approved devices, which the dissent finds controlling, was overcome in Congress’s estimation by solicitude for those who would suffer without new medical devices if juries were allowed to apply the tort law of 50 States to all innovations.
Op. at 13 (more gleeful emphasis).
Next there's some dictum (because the majority finds the statutory language controlling) to the effect that the FDA's amicus views in this case are entitled only to so-called Skidmore (relatively low) deference because of the "different" position taken by the FDA previously. The FDA's prior anti-preemption position, however, "is even more compromised, indeed deprived of all claim to deference, by the fact that it is no longer the agency’s position." Op. at 13. Thus the old Kernats brief is interred with a stake through its heart.
Then, in what is probably the most significant spillover in the opinion, the majority addresses the dissent's reliance upon precedent involving preemption in prescription drugs and food additives. It's in the nature of "wait a minute, we've never rejected drug preemption":
Two points render the conclusion [about drugs and additives] the dissent seeks to draw from that experience — that the pre-emption clause permits tort suits — unreliable. (1) It has not been established (as the dissent assumes) that no tort lawsuits are pre-empted by drug or additive approval under the FDCA. (2) If, as the dissent believes, the preemption clause permits tort lawsuits for medical devices just as they are (by hypothesis) permitted for drugs and additives; and if, as the dissent believes, Congress wanted the two regimes to be alike; Congress could have applied the pre-emption clause to the entire FDCA. It did not do so, but instead wrote a pre-emption clause that applies only to medical devices.
Op. at 13-14 (emphasis added that goes beyond glee). The court thus considers the issue of prescription drug preemption open, and not foreclosed by any prior precedent. We'll see what happens, but we have to say that we feel better about Wyeth v. Levine after reading this.
Because we defend both drugs and devices, we also note that a lot of the court's description of the PMA process (Op. at 4-6) strongly resembles the kind of FDA approval gauntlet that applies to New Drug Applications - both in terms of the requirements for safety and effectiveness and with respect to the size of the application and the comprehensiveness of the FDA's review. We put that in the plus category, too.
Nor are common-law tort claims ao "general" that they escape preemption. Rather plaintiff's "suit depends upon [a state's] 'continu[ing] in effect' general tort duties 'with respect to' Medtronic’s catheter." Op. at 14-15 (quoting preemption clause). That is enough for preemption:
Nothing in the statutory text suggests that the pre-empted state requirement must apply only to the relevant device, or only to medical devices and not to all products and all actions in general.
Op. at 15. Thus ends the plaintiffs' would-be "this device only" gloss on the MDA's preemption clause. Here the FDA's position, being a regulatory interpretation, rose to the level of Auer deference (better than Skidmore; not as definitive as Chevron). The regulation plaintiff relied upon didn't mention common-law claims at all, and "the regulation excludes from pre-emption requirements that relate only incidentally to medical devices, but not other requirements [like g]eneral tort duties of care." Id. Instead the regulation (21 C.F.R. §808.1(d)(1), for you hard core types) "sets forth a 'general rule' pre-empting state duties 'having the force and effect of law (whether established by statute, ordinance, regulation, or court decision)....'" Op. at 16 (emphasis original with the court). The majority's reaction is that this language has to refer to the common law:
We are aware of no duties established by court decision other than common-law duties, and we are aware of no common-law duties that relate solely to medical devices.
Id. (sarcasm original with the Court). Ultimately, though, the majority decides that the regulation is simply too confusing to be worth anything. Id. ("All in all, we think that §808.1(d)(1) can add nothing to our analysis but confusion").
At the tail end of the opinion the majority refuses to address plaintiff's belatedly raised argument that their claims involved "parallel" claims under Lohr. Op. at 17. Thus it leaves Lohr intact on the point. We suspect that the Court will have more to say on this subject when it decides Warner-Lambert v. Kent (which will be argued next week - on February 25).
Stevens concurs in the result, essentially because the plain language of the preemption clause trumps any absence of any specific congressional intent to preempt.
Ginsberg dissents, essentially because she believes the absence of any specific congressional intent to preempt trumps the plain language of the preemption clause.
Now, you'll have to excuse us - we're going out to join the party.
We're sure we'll have more to say, but we wanted to let everyone know.