FCA, FDA, What's The Difference?

Here is another post by Reed Smith's Eric Alexander, quasi-member of our blog.  At this point, we think he's only holding off becoming a full blogger because as long as he doesn't have his own blogger account, somebody else (like Bexis) has to take the time to input his posts.

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            We welcome ourselves back after our hiatus.  Not that blogging/blawging is not real work, but we sometimes have clients pay for our quips—and, perhaps, occasional legal insights.  Plus, the product liability decisions have been fairly slim, particularly after more venerable—they would say venerated—posters call “dibs.”  So, we wade into the wonderful world of the False Claims Act (FCA).  We products lawyers might say that we sometimes view FCA cases as red headed stepchildren if we were not a little afraid of retribution from the soulless GLA (Ginger Liberation Army).  Since we will not say such a thing, we will say that FCA cases do not involve plaintiffs with real or trumped-up physical injuries or state court judges and juries.  They do involve issues of compliance with FDA regulations, some Latin phrases, and often a “U.S.” on the other side of the v.  That makes them relevant to what we do and what this ABA-nominated blog does.  (Non-products lawyers can vote too.  There is no hair color or prevalence requirement.  That comes from a footnote in the Harper v. Virginia Board of Elections on poll taxes.  Bexis says it is precedential; McConnell says it is only dicta because it does not use a form of the words “hold” or “find.”)

            U.S. ex rel. Polansky v. Pfizer, Inc., No. 04 Civ. 0704 (BMC), 2012 U.S. Dist. LEXIS 163557 (E.D.N.Y. Nov. 15, 2012), is the final dismissal of a FCA case filed in 2004 that was on its Fifth Amended Complaint at the end.  Setting aside why it took eight years and six complaints to get rid of what was ultimately not a cognizable claim, this is a nice decision.  We cannot quite set aside that the U.S. chose to intervene in this case and the chance that its intervention increased the lifespan and defense costs of the case.  The basic claim was that the defendant promoted its product (Lipitor) off-label, allowing for Medicare and Medicaid to pay for prescriptions written and filled for patients who were not within the approved indication for the product.  That part is pretty standard.

            In Polansky , however, the plaintiff’s view of who was and who was not within the label was not at all standard.  Rather, it hinged on the reproduction in the Indications and Usage section of the 2005 label of a table summarizing the 2002 Guideline from the National Cholesterol Education Program—a program launched by the National Heart, Lung and Blood Institute of the National Institutes of Health.  (The Guideline is actually the Third Report of the Expert Panel on Detection, Evaluation, and Treatment of High Blood Cholesterol in Adults (Adult Treatment Panel III).)  Id. at **2-3 & 6.  We could use acronyms if it would help clarify.  Like most treatment guidelines, this gave various criteria for when “to consider drug therapy” and included a healthy dose of clinical judgment—the Judge pulled out a [sic] on the label’s use of “judgement.”  Id. at **6-7 & 15.  Plaintiff maintained that any promotion for a patient outside of the “consider” column of the table, even 1 mg/dL of LDL, was off-label promotion and triggered FCA liability.  Id. at *7.  This table dropped out of the label with its PLR revision in 2009, but the plaintiff still maintained that the label had this restriction because it said “(see current NCEP Guidelines)” in the Dosage and Administration section.  Id. at **11-12.

            The court saw through this nonsense for both versions of the Lipitor label.  Not only do guidelines not impose “mandatory limitations” by nature of only being guidelines and not edicts, but this one was pretty clear that it “should not be viewed as a standard of practice” and “should not override a clinician’s considered judgment in the management of individuals.”  Id. at **8 & 16.  The labels (in Indications or elsewhere) did nothing to limit use only any patient population defined by any portion of the NCEP Guidelines, so the off-label argument fell flat.  It was also pretty easy to find that the label without the table or any mention of the NCEP Guideline in the Indication section did not impose some Guideline-based limit on permissible use for the FCA.  Id. at *14.  [FDA inside baseball aside:  It also would have been easy to go to Drugs@FDA and pull up the Medical Officer Review and Approval Letter from 1996 to see that the original approved indication for hypercholesterolemia was not linked to any NCEP Guideline, let alone the one from six years later.  Or to look at the language before the table in the 2005 label, which clearly referenced the “Guidelines, summarized in Table 6” in connection with advice about trying “diet and other nonpharmacological measures” first.]  Particularly since the FCA is intended to punish “quasi-criminal conduct,” tenuous arguments about off-label promotion do not state claims for FCA violations.  “The False Claims Act, even in its broadest application, was never intended to be used as a back-door regulatory regime to restrict practices that the relevant federal and state agencies have chosen not to prohibit through regulatory authority.”  Id. at **19 & 21.

            This is really why we are writing about the case.  We think the words “State product liability law” could replace the first four words of that quote and it would still be true.  We know that, particularly for an implied preemption analysis, regulatory requirements and state product liability cases involving drugs and devices can exist in parallel.  We also know that plaintiffs like to say compliance with regulatory requirements means nothing for the viability of their claims—although some legislatures have disagreed, as we’ve discussed here.  Then they will try to turn any arguable non-compliance, whether it relates to the scope of promotion, the sampling frequency of finished product at the factory, or the 1% of 15-day reports being filed in 16 days, into proof of negligence or design defect.  Except in rare instances, product liability claims for prescription drugs and devices are really about warnings and the adequacy of warnings is usually measured by the content of the label itself.  The Polansky court had a pretty good handle on how labels actually work.

            First, if you want to know who is supposed to use the drug, you might look at the Indications and Usage section.  If you want to know who is not supposed to use the drug, you might look at a section with a clever title like Contraindications or Limitations of Use.  Together, it is not that hard to figure out what use is on-label and what use if off-label.  As the court said, “There is a distinction between off-label marketing to achieve a treatment not contemplated by the label (e.g., hair growth or curing cancer), and marketing to a patient population not specifically mandated by the label.”  Id. at **19-20.  Put another way, there is a difference between references in the label that are “merely informational and advisory” and language that imposes “restrictive limitations.”  Id. at *22.  Second, what the label does and does not say—Levine’s gross misunderstanding of CBE labeling changes notwithstanding—typically reflects FDA’s judgment.  The inclusion of the table summarizing the NCEP Guidelines in a post-approval labeling change was “because the FDA has determined to pass along that advice through the label” and FDA “could have easily required” explicit restrictions on use in the Lipitor label, as it “commonly” does with other labels.  Id. at *17.  That sounds like what actually happens.

            It is nice to see a judge with a proper understanding of how drug labels, FDA, and cockamamie theories about off-label marketing should fit together.  We would like to see more of the judges handling product liability cases with similar issues follow the lead of the judges handling FCA cases and dismiss complaints premised on nonsensical interpretations of labels and regulations.  We would also like to see judges kick bad cases without allowing serial amendments of defective cases.  The unpublished decision in U.S. ex rel. Fox Rx, Inc., v. Omnicare, Inc., 1:11-cv-00962-WSDD (N.D. Ga. Aug. 29, 2012), which we learned of because it was in a “Statement of Recent Decision” filed by the U.S. Dept. of HHS as a defendant in another case, comes to mind.  This is an FCA case with allegations that the defendant, a specialty pharmacy attendant to nursing homes, dispensed atypical antipsychotic drugs off-label, among other allegations of bad Medicare practices.  While most of the grounds for dismissing the off-label claims were denied, the court recognized that the complaint lacked detailed allegations that the prescriptions were ever submitted for reimbursement claims, something even us non-FCA lawyers know matters because the C in FCA stands for Claims.  But the plaintiff was permitted to file a Third Amended Complaint to try to fix the problem.  We guess that three strikes was not an out, like in baseball before the rule changes in the late 1880s.  (Bexis is a longtime member of SABR’s Nineteenth Century Baseball committee; we hear their keg parties are awesome.)

            We have heard from colleagues of some recent FCA dismissals for the same defendant pharmacy that were with prejudice.  Where a fundamental part of the plaintiff’s case depends on some overly technical alleged violations of FDA regulations that do not really matter to whether the product is safe and effective and marketed appropriately is makes sense to put the case to bed, whether it be a FCA case or a products case.

            We have certainly heard arguments from product liability plaintiffs and their purported regulatory experts about how even one observation in a post-inspection FDA form 483 (put there so the inspector had something to write) means that the jury should go straight to calculating damages.  While it is possible to walk from some alleged non-compliance with an aspect of cGMP or some quirky interpretation of the label along the path to products being adulterated or misbranded, the judges with product liability cases should be able to see through the regulatory fog as decisively as the Polansky judge did.  Sometimes, without the fog, you can see the path is full of crap before you step in it.