Friday, October 09, 2009

Off-Label Promotion - Scratch One Flat Suit

"Scratch One Flat Top" marked the sinking of an enemy aircraft carrier in the Battle of the Coral Sea.

In the battle over off-label promotion, scratch another lawsuit. Central Regional Employees Benefit Fund v. Cephalon, 2009 U.S. Dist. Lexis 93636 (D.N.J. Oct. 7, 2009), sends another would-be third party payor fraud suit to the bottom, granting a motion to dismiss.

The highlights:

We love CAFA - that's how there's federal jurisdiction. Lexis slip op. at *2.

Third-party payors don't have standing as "consumers" under the New Jersey Consumer Fraud Statute. Id. at *7.

"Mere allegations that [defendant] provided prescription drugs, without saying to whom or under what circumstances, wholly fail to state a claim for fraud." Id. at *9.

"[I]t is well-established that off-label marketing of an approved drug is itself not inherently fraudulent." Id. at *10.

An interesting use of Twombly/Iqbal to hold that class action allegations are insufficient:
To the extent that the plaintiffs state in the "Class Action Allegations" section of the Complaint that one of the issues to be determined in the case is "whether the defendants misrepresented the efficacy and/or cost effectiveness and/or economic efficiency of" the drugs, that statement contains no factual allegations, which are required under Twombly and Iqbal.

2009 U.S. Dist. Lexis 93636, at *11. We haven't seen T/I applied against this type of allegation before, at least not in our sandbox.

Reference to a guilty plea to an illegal off-label marketing claim does not plead fraud with particularity. Id. at *12.

Past statutory/regulatory violations are not common-law fraud because only the government can enforce the FDCA. Id. at *12-13 & n.4.

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