Although they have nothing to do with the Affordable Care Act, health-care-related so-called “death panels” do exist.  These panels are operated by state agencies and private health insurance companies, and they decide whether to reimburse as “medically necessary” (or some similar definition) any type of medical care that comes into question.  They’re an unfortunate necessary – quackery should not be reimbursed.  But such panels used to reject any form of off-label use, until states and the federal government passed laws and regulations telling them that they couldn’t.  As we’ve explained elsewhere, off-label use can frequently represent the medical standard of care.

But in Harborth v. State, ex rel. Dep’t of Workforce Services, ___ P.3d ___, 2018 WL 4011635 (Wyo. Aug. 22, 2018), we ran into one of the limits to those protections – and to off-label use – that we haven’t seen in a published opinion in quite some time.  Something isn’t “off-label” when there is no FDA-approved label at all. The Wyoming Supreme Court affirmed a coverage denial of therapy involving the implantation of a medical device that had never been approved by the FDA for labeling and marketing for any intended use whatsoever.

How could that happen?

The FDA only regulates prescription medical products in the United States.  In Harboth, the claimant had a history of chronic back problems.  Ultimately the state worker’s compensation panel approved a rather expensive and involved surgical procedure:

a foraminotomy at L4-5 and transforaminal lumbar interbody fusions (TLIF’s) at both L5-S1 and T12-L1.  [Claimant] testified that [the recommended] surgery would cost approximately $400,000.

2018 WL 4011635, at *1.

Before agreeing to cover this surgery, the state required “two peer reviews.”  Id.  That took some time, and in the interim, the claimant got cold feet.  Id. at *2.  She was also in “excruciating pain” waiting for worker’s comp. to make up its mind.  Id. at *3.  The claimant investigated various treatments for her condition online, and learned about “artificial disc replacement surgery using the ‘M6’ artificial disc.”  Id. The surgeon who performed this procedure was in Germany.  The claimant crossed the pond and had the surgery.  Not only was it “successful,” but it cost a fraction of the $400,000 that the “death panel” was prepared to pay for the other type of surgery.  Id. at *4 (surgery was “appeared to be a success”), *10 (“surgery cost[] $340,000 less than [the initially proposed] procedure”).

The state’s version of a “death panel” nonetheless “denied compensation for the surgery, finding that it was not reasonable and necessary medical treatment.”  Id. at *3.

Why?

Because it could. The relevant reimbursement guidelines authorized payment for “off-label use,” but the M6 device had only received governmental approval for use in the European Union, and not from the FDA. Id. at *3 (“there has been no United States FDA approval of the M6-L disk replacement system”).

If the surgery had really been “off-label use” (ironically, a basis for the denial of the claim by the panel), then the claimant may have had a chance:

Rules recognize optional approaches to verifying that a procedure or device lacking FDA approval is reasonable and necessary. . . .  For “off-label use of medical services,” the health care provider must submit a comprehensive review of the medical literature supporting the off-label use, including “at least two (2) reliable prospective, randomized, placebo-controlled, double-blind trial[s].”

Harborth, 2018 WL 4011635, at *5 (citations to various rules omitted).

But the procedure had to involve “off-label use” in order to fit under these rules.  “‘Off-label use of medical services’ is defined as:  ‘Medications, treatments, procedures or other medical services used for other than the approved Food and Drug Administration (FDA) indications.’  Id. at *6 (citation and quotation marks omitted).  Off-label use is OK:

[O]nce the FDA has cleared a device for introduction into the stream of commerce, physicians may use the device in any manner they determine to be best for the patient, regardless of whether the FDA has approved the device for this usage.  This practice by physicians is known as “off-label” usage.

Id. (citation and quotation marks omitted).  But for the use of a device to be “off-label,” that device must first have been approved for marketing and labeling by the FDA for something.  The M6 wasn’t:

“[O]ff-label” medical service [i]s one that deviates from a use that has been approved by the FDA. . . . Under . . . the Division Rules, the plain definition of “off-label” use does not encompass the surgical implantation of an M6 artificial disc adjacent levels. The M6 artificial disc is not approved for any use by the FDA.  Thus, there is no “label” from which a medical provider may deviate.

Id. (citations and quotation marks omitted) (emphasis added).

Because the rules and regulations under which the state’s workers compensation system operated were “clear and unambiguous” in defining off-label use, nothing else mattered.  It didn’t matter that the claimant appeared to have a better prognosis (she returned to work, which was questionable under the other surgical alternative).  It didn’t matter that the surgical option the claimant pursued saved the state hundreds of thousands of dollars.

[Claimant] urges us to consider the success of her surgery as documentation of its safety and effectiveness. . . . [I]t may be tempting to weigh the actual outcome of surgery into the determination of compensability. Because [she] underwent surgery costing $340,000 less . . . and returned to her previous work duties with no restrictions and no pain medication, the evidence of her outcome is especially compelling. However, . . . it would be unreasonable to view the outcome of a medical procedure as a factor that trumps all others. [The] . . . Rules do not award compensation for medical treatments only if they are “successful” . . .; instead, in order to receive medical benefits, a claimant must show that his treatment is “reasonable and necessary.” A patient might fail to respond to reasonable and necessary medical treatment; and, likewise, a patient may benefit from elective, “unnecessary” medical treatment.

Id.  Anecdote, unfortunately for this claimant, is not data.  “A claimant’s successful surgery is only a single instance of success, and is not a substitute for objective and verifiable medical data demonstrating the procedure’s overall record for safety and effectiveness.”  Id.

It’s been a long time since we’ve seen a court draw this distinction.  In Gaston v. Hunter, 588 P.2d 326, 330 (Ariz. App. 1978), the court held that informed consent rules applicable to off-label use do not apply to an “experimental” medication that had not yet received FDA approval for anything, and was still under clinical investigation.  Similarly, in Retkwa v. Orentreich, 584 N.Y.S.2d 710 (N.Y. Sup. 1992), it was not off-label use to employ “liquid injectable silicone” in surgery where the material was not being sold as a medical device at all (a prior opinion in the same case called it “non-medical grade”).  “It is a reasonable assumption that most patients, confronted with a doctor’s recommendation for injection of a foreign substance, presume that such substance has been the subject of official testing, consideration, and approval.”  Id. at 712 n.6.

Whatever ones opinion of the third-party payor would-be “death panels,” and whether or not the “ends” in Harborth should have justified the means, the decision is a reminder that not everything that doctors do with FDA-regulated prescription medical products fits neatly into the two categories of “labeled use” (called “intended use” by the FDA) and “off-label use.”  With the Internet making ever more medical information (and disinformation) available without regard to national borders, we would not be surprised to encounter more cases where the distinction drawn in Harborth is relevant.

We’ve complained before about the federal government’s monetization of First Amendment violations in the context of truthful promotion of off-label uses:

[T]he government has ruthlessly monetized its questionable ban on truthful off-label promotion for quite a few years now. Indeed, the government has used this ban as the basis for a creeping administrative takeover of pharmaceutical and medical device public relations practices.  Don’t believe us?  Just take a look at the Office of Inspector General’s list of “corporate integrity agreements.”

Then, in the wake of the First Amendment win in Amarin Pharma, Inc. v. FDA, 119 F. Supp. 3d 196 (S.D.N.Y. 2015), we noted an interesting provision in the settlement that ended that litigation:

. . .[N]othing in this Order shall be construed to limit Amarin’s to free speech concerning Vasepa.

That got us thinking, and we commented about OIG’s corporate integrity agreements (“CIAs”) in the wake of a hypothetical First Amendment invalidation of the FDA’s ban on truthful promotion of off-label uses:

Well, come the millennium, those CIAs – most of them, anyway – will still be there. What then? Will the government take the position, again backed by threats of debarment, that regardless of the First Amendment, companies have limited their rights voluntarily by what they agreed to in particular CIAs?

We thus recommended addition of First Amendment non-waiver provisions in all future deals with the government that touched upon off-label promotion.  After all, the government has hardly been consistent in its positions regarding the First Amendment and truthful off-label promotion.

We hope all of you out there were listening, because the federal Office of Inspector General (“OIG”) recently made just such a waiver argument in an action, Patient Services, Inc. v. United States, No. 3:18-cv-00016-MHL, pending in the Eastern District of Virginia. Patient Services does not involve a CIA or off-label promotion, but the arguments are the same.  According to the complaint in Patient Services:

  1. PSI is a non-profit charitable foundation that operates Patient Assistance Programs (“PAPs”), which provide financial and other assistance to indigent patients who have chronic and often life threatening diseases that require expensive treatment and management. . . .  Since 2002, OIG has provided public guidance directing how PAPs should be structured and operate in accordance with its view of the Anti-Kickback statute.

  2. Specifically, since 2002, and like all other PAPs, PSI has operated pursuant to an Advisory Opinion from OIG that provides specific guidance as to how PSI should operate and structure its programs to avoid a risk of an enforcement action. . . . The 2017 Modified Advisory Opinion, however, imposes new and oppressive restrictions that cripple PSI’s ability to carry out its charitable efforts.  In particular, the 2017 Modified Advisory Opinion imposes new restrictions that prevent PSI from communicating with donors, potential donors or their purported “affiliates” about new or modified programs to treat chronic diseases affecting indigent populations.

Cutting out the legal jargon, the government is threatening PAP charities with prosecution to keep them from discussing the medical conditions they seek to combat with “donors” – who may also be manufacturers of products used to treat those conditions.  To operate, Patient Services must have an OIG advisory opinion, which it did through 2014.   Then, according to the complaint, OIG changed the rules.  “OIG specifically required [plaintiff] to make a series of certifications to retain an advisory opinion.”  Complaint ¶81.  In order to keep operating, the plaintiff accepted the certifications (nearly “two dozen” of them), and in the litigation, challenged them on First Amendment grounds.  Id. ¶¶82-84.

If, instead of charities and mandatory OIG “certifications,” we were to substitute FDA regulated manufacturers and CIAs involving off-label promotion restrictions, it would be the same situation we warned about previously.  That’s why the Patient Services interests us.

In a recent brief in Patient Services, OIG now argues that, regardless of what the First Amendment may or may not protect, the plaintiff waived its First Amendment rights when it agreed – under threat of prosecution − to the certifications.  Deleting as many case-specific facts as possible, OIG’s argument goes:

[T]his case . . . involves a negotiated waiver of First Amendment rights. . . .  In Lake James [Community Volunteer Fire Dept., Inc. v. Burke County, N.C., 149 F.3d 277, 280 (4th Cir. 1998)], . . . a fire department’s “agreement to consent to citizens’ petitions and not to challenge them in court [wa]s [an] enforceable” waiver of its First Amendment rights.  Id.  Notably, the court applied this standard notwithstanding the fire department’s argument that it had been put to the choice between agreeing to a contract that included what it perceived to be unconstitutional provisions and going without the contract and the benefits it provided. . . .  Because the case ultimately involved a negotiated waiver of constitutional rights, the court applied the test, described below, to determine the enforceability of that waiver.

Just so here. [Plaintiff] agreed to the three provisions about which it now complains, i.e., to the extent these provisions affect [its] rights, it is because [plaintiff] waived those rights. . . .  Indeed, the negotiations were conducted by the Agency and counsel for [plaintiffs]. . . .

Under Lake James, a negotiated waiver of First Amendment rights is valid if it (1) is a “knowing waiver,” that is (2) “voluntarily given,” (3) and which does “not undermine the relevant public interest.”  149 F.3d at 280.  . . . Judicially noticeable facts and facts included in the administrative record – namely, the size and sophistication of [plaintiff] . . ., the fact that it was assisted by counsel, and the fact that negotiations stretched on for years – indicate that any waiver of First Amendment rights was both knowing and voluntary.

OIG brief at 9-11 (factual citations omitted) (emphasis added).

So there you have it.  Even if we win, and truthful off-label promotion is declared constitutionally protected from government interference, OIG is prepared to argue that existing CIAs – even though negotiated under threat of federal debarment – remain enforceable.  Almost all manufacturers with CIAs far exceed the charitable plaintiff in Patient Services in terms of “size and sophistication,” and all were “assisted by counsel” in the “negotiations” that produced CIAs in which they agreed to refrain from all off-label promotion, including truthful promotion.  So, even though those CIAs were about as voluntary as breathing, expect the OIG to argue otherwise, because it is arguing just that, right now.

Amarin was smart when it insisted on a First Amendment non-waiver provision when it settled with the government.  Of course, it also had a more favorable negotiating position, having won a First Amendment decision that the government was loathe to appeal.  Anyone subject to a CIA who doesn’t have such a provision, however, must be prepared to fight a second front, against OIG, even after Sorrell v. IMS Health Inc., 564 U.S. 552 (2011), is applied to truthful off-label promotion on a nationwide basis.

Be prepared – and watch what happens with constitutional waiver in the Patient Services case.

Researchers at Temple University here in Philly recently published a scientific article, “Learning Impairments, Memory Deficits, and Neuropathology in Aged Tau Transgenic Mice Are Dependent on Leukotrienes Biosynthesis: Role of the cdk5 Kinase Pathway,” in the scientific journal Molecular Neurobiology.  That sounds pretty dense, but what the article concludes is that the generic drug zileuton (branded name Zyflo) has been shown – in a transgenic mouse study – to reduce both physical evidence of Alzheimer’s disease, and its mental symptoms.  To wit:

[A]ged tau transgenic mice were randomized to receive zileuton . . . starting at 12 months of age for 16 weeks and then assessed in their functional and pathological phenotype.  Compared with baseline, we observed that untreated tau mice had a worsening of their memory and spatial learning.  By contrast, tau mice treated with zileuton had a reversal of these deficits and behaved in an undistinguishable manner from wild-type mice.

“Learning Impairments” Article, at Abstract (emphasis added).  In lay terms, it might just successfully treat (we hesitate to throw the “c” word around) Alzheimer’s disease.

Nothing else works very well at treating Alzheimer’s disease.

Zileuton/Zyflo has been on the market since 1996, indicated for treatment of asthma, and is thus available for generic production under Hatch-Waxman.

Since this drug has already been FDA approved, it may also be used off-label, right now, to treat Alzheimer’s patients under the therapeutic rationale explained in the “Learning Impairments” article.  With the drug’s basic safety profile already established by FDA approval and twenty-something years of clinical use, the primary issue in any such off-label use is effectiveness – does it actually benefit Alzheimer’s patients – rather than safety.

Let’s assume, for the moment, that zileuton/Zyflo actually has therapeutic value for treating Alzheimer’s in humans.  This is a drug that can be produced generically, so who is going to finance the Phase III human studies necessary to provide the “substantial evidence” that the FDA requires for a label change adding a new indication?  If any generic manufacturer can take a “free ride” on studies sponsored – at great expense – by someone else, then there is not much incentive for anyone to spend that money.  Thus, this extremely consequential new indication may become a regulatory orphan.  Of course, if the drug shows sufficient promise, other sources of funding could become available – third party payers who pay for the medical needs of Alzheimer’s patients, or even the research fund that is supported by the recently issued Alzheimer’s semipostal stamp.

If this off-label use is truly beneficial, then it would (in the absence of any better treatment option) likely become the medical standard of care despite being off-label.  Eventually, the FDA would be forced to engage in some ad hoc, retrospective approach in order to reconcile the label with clinical practice.  That’s how the FDA finally resolved the regulatory conundrum of so-called “pedicle screws,” where regulation fell behind clinical practice – a retrospective study supported the safety and effectiveness of off-label spinal use, but only after manufacturers endured a decade of meritless product liability litigation.  See 63 Fed. Reg. 40025-41 (FDA Jul. 27, 1998).

While further studies are being performed, however, what happens to scientific communication?  This could be (or it could not be – too early to tell for sure) an historic breakthrough in treatment of Alzheimer’s.  If it is, does the FDA continue to prohibit any manufacturer of zileuton/Zyflo from informing the medical community of information on the effectiveness of the off-label treatment, such as optimal dosage and administration practices?  We’ve frequently decried the unconstitutionality of such speaker- and topic-based restrictions on manufacturer scientific communications under the First Amendment.  However, for the most part the FDA’s refusal to conform to current First Amendment norms has flown under the public’s radar, allowing the agency to get away with dilatoriness, and the rest of the government to monetize the FDA’s unconstitutional stance with through “false” claims litigation that isn’t really about falsity.

Alzheimer’s, however, is the elephant in the room.  Without some sort of effective treatment, our health care system cannot indefinitely support the cost of palliative Alzheimer’s care.  Almost everybody knows somebody suffering from dementia, or else someone suffering through the heartbreak of caring for someone with dementia.  The FDA will run into a political and medical buzz saw if its retrograde attitude towards truthful off-label promotion gets in the way of making information about an effective (we hope) treatment for Alzheimer’s available to the public.

And now – but probably not coincidentally – it looks like the FDA is finally getting off the regulatory schneid.  A couple of days ago, the agency issued a “statement” from the commissioner about what was billed as a “new effort” “to advance medical product communications to support drug competition and value-based health care.”  The big news in the statement is rather buried in regulatory-speak, but it is legitimate big news:

Additionally, it’s our [FDA’s] belief that giving companies clear guidelines for providing payors with truthful and non-misleading information about unapproved products and unapproved uses of approved or cleared products will help facilitate communications that can allow payors to provide coverage for these new products and new uses more quickly after FDA approval or clearance.  And our hope is that these communications can also help companies and payors establish pricing structures that benefit patients as well as health plans.

(Emphasis added).  That’s a reference to (among other things) off-label use.  Specifically, the FDA is now approving “truthful and non-misleading” off-label promotion when directed to an audience of third party payors.

The details of this regulatory retreat from Moscow are found in the FDA’s new final guidance, “Drug and Device Manufacturer Communications With Payors, Formulary Committees, & Similar Entities − Questions & Answers, available here.  That’s another mouthful, so we’ll call it the “Off-Label Promotion (OLP) Guidance,” since that’s really what it is.

The FDA is now allowing those who market prescription drugs and medical devices (see id. at 16 explaining the identical treatment of all classes of medical devices) to provide information about off-label uses of these products to “payors, formulary committees, or other similar entities with knowledge and expertise in the area of health care economic analysis.”  OLP Guidance at 1 (footnote omitted)

This audience includes public and private sector payors, formulary committees (e.g., pharmacy and therapeutics committees), drug information centers, technology assessment committees, pharmacy benefit managers, third party administrators, and other multidisciplinary entities that, on behalf of health care organizations, review scientific and/or technology assessments to make drug or device selection or acquisition, formulary management, and/or coverage and reimbursement decisions on a population basis.

OLP Guidance at 5 (footnotes omitted).

That’s the who.

The “what” is just about everything.  The kind of information that regulated drug and device manufacturers can now provide to third-party payors about off-label uses is defined as:

“any analysis (including the clinical data, inputs, clinical or other assumptions, methods, results, and other components underlying or comprising the analysis) that identifies, measures, or describes the economic consequences, which may be based on the separate or aggregated clinical consequences of the represented health outcomes, of the use of a drug.  Such analysis may be comparative to the use of another drug, to another health care intervention, or to no intervention. . . .  [Off-label promotion] may include comparative analyses of the economic consequences of a drug’s clinical outcomes to alternative options (including the use of another drug) or to no intervention.

[The information] can be presented in a variety of ways that can include, but are not limited to, an evidence dossier, a reprint of a publication from a peer-reviewed journal, a software package comprising a model with a user manual, a budget-impact model, a slide presentation, or a payor brochure.

OLP Guidance at 4-5.

The “when” varies a bit depending on whether what kind of off-label use is at issue.  The FDA has drawn what we believe to be a new distinction between “material differences” from the labeling that “relate[] to an approved indication” and so-called “unapproved indications.”  Id. at 7.  In our experience, the FDA has always considered any variance from labeling limitations to be off-label use.  But now, as to approved indications, “material differences from the FDA-approved labeling (e.g., new or increased risks, different dosing/use regimens, different endpoints, more-limited/targeted patient populations)” are treated differently, and somewhat less stringently.  Id. at 6.  A presentation “should include an accurate overview of the design of the economic analysis, including a statement of the study objectives.”  Id. at 11 (going into considerable detail).

As to promotion of uses involving such “material differences” from labeling, a basis in “competent and reliable scientific evidence” is sufficient.  Id. at 10.  In determining the sufficiency of the scientific basis, the FDA will be deferring to “existing current good research practices for substantiation developed by authoritative bodies.”  Id.  The prior FDA requirements of “substantial evidence” is nowhere mentioned.  It appears to be gone as a restriction on off-label promotion under the OLP Guidance.  Promotion of “material differences” must include a “conspicuous and prominent statement describing” those differences.  Id. at 14.

However, off-label promotion “regarding unapproved products and unapproved uses of approved/cleared products” is also now allowed by the FDA.  Id. at 18-20.  As to this type of what might be considered “true” off-label uses, distribution of the following information to third-party payers is now OK with the FDA:

  • “Product information (e.g., drug class, device description and features).”
  • “Information about the indication(s) sought, such as information from the clinical study protocol(s) about endpoint(s) being studied and the patient population under investigation (e.g., number of subjects enrolled, subject enrollment criteria, subject demographics).”
  • “Anticipated timeline for possible FDA approval/clearance/licensure of the product or of the new use.”
  • “Product pricing information.”
  • “Patient utilization projections (e.g., epidemiological data projection on incidence and prevalence).”
  • “Product-related programs or services (e.g., patient support programs).”
  • “Factual presentations of results from studies, including clinical studies of drugs or devices or bench tests that describe device performance (i.e., no characterizations or conclusions should be made regarding the safety or effectiveness of the unapproved product or the unapproved use).”

Id. at 18-19.

This kind of off-label promotion should be accompanied by a variety of disclaimers and other information to ensure that the off-label nature of the uses involved is understood:

  • “A clear statement that the product or use is not approved/cleared/licensed, and that the safety or effectiveness of the product or use has not been established.”
  • “Information related to the stage of product development” and “whether a marketing application for the product or new use has been submitted to FDA or when such a submission is planned.”
  • “[M]aterial aspects of study design and methodology and . . . material limitations related to the study design, methodology, and results. Firms should also ensure that results are not selectively presented.”
  • “A prominent statement disclosing the indication(s) for which FDA has approved, cleared, or licensed the product and a copy of the most current FDA-required labeling.”

Id. at 19.  Significantly, there is no prerequisite that an FDA application for marketing be either pending or contemplated, although if this is the case, it should be disclosed.

As to off-label promotion of these so-called “unapproved uses” (and also drugs and devices that have not yet received any FDA regulatory OK), the FDA tries to salvage what it can of the justifications it used to advance in opposition to our side’s First Amendment arguments about truthful off-label promotion:

FDA believes that the categories of information . . . are, on the one hand, broad enough to encompass the information that payors may need to make informed coverage and reimbursement decisions and, on the other hand, limited enough to maintain appropriate incentives for firms to conduct robust studies to evaluate the safety and efficacy of unapproved products and unapproved uses of approved/cleared/licensed medical products. . . .  FDA believes that the risk that payors will be misled is relatively low.  Payors are a sophisticated audience with established procedures to carefully consider the full range of relevant evidence about new uses of medical products.

OLP Guidance 21-22.

Finally, the OLP Guidance reminds us that “[f]irms’ communications to other audiences about unapproved products or unapproved uses of approved/cleared/licensed products could raise additional or different considerations and are beyond the scope of this guidance.” Id. at 22.

In conclusion, let’s look at that last point a bit. The OLP Guidance punches another huge hole in the FDA’s previous attempts to ban regulated entities from distributing truthful information about off-label uses to anybody.  As discussed at some length in Greater New Orleans Broadcasting Ass’n, Inc. v. United States, 527 U.S. 173, 192-94 (1999), the number and nature of exceptions to a speech prohibition adversely affect both the prohibition’s rationality and its ability to advance the governmental interest that motivates it.  We fail to see how any constitutionally valid distinction can exist between providing the identical information, with identical disclaimers and limitations, to one “sophisticated” audience (third-party payors) while prohibiting that information’s distribution to another “sophisticated” audience – that being medical doctors that directly prescribe these drugs and devices.

And that’s just within the rubric of commercial speech.  Greater New Orleans also cautioned, “decisions that select among speakers conveying virtually identical messages are in serious tension with the principles undergirding the First Amendment.”  Id. at 194.  We now have Sorrell v. IMS Health, Inc., 564 U.S. 552 (2011), for the proposition that, with respect to pharmaceutical detailing, we’re not just dealing with commercial speech.

Thus, we believe that, as a practical matter, the OLP Guidance effectively dooms any First Amendment defensibility of an FDA ban on the same truthful information being distributed, in the same fashion, to the rest of the medical community beyond third-party payors.  Conversely, to those regulated entities that seek to inform physicians of truthful scientific information about their products, we believe that the OLP Guidance can serve as a roadmap to success in an Amarin Pharma, Inc. v. FDA, 119 F. Supp.3d 196 (S.D.N.Y. 2015), situation by establishing that off-label promotion is “truthful,” “not misleading,” and therefore protected against governmental enforcement activity.  After all, just as third-party payers are sophisticated professionals interested in possible effective treatments for Alzheimer’s disease, so are the doctors directly involved in treating Alzheimer’s patients.

This post is from the non-Reed Smith side of the blog.

We’ve posted on two other occasions about the Shuker v. Smith & Nephew case as the Eastern District of Pennsylvania systematically dismantled the case on the grounds of preemption and pleading deficiencies. You can find those posts here and here. Unfortunately, the recent Third Circuit opinion deciding plaintiff’s appeal isn’t the full affirmance we had been hoping for. But before you get the wrong idea, the Third Circuit got the most important issue right – when you have a multi-component medical device, PMA preemption is to be addressed on a component-by-component basis. After that, however, the appellate decision does some unraveling of the district’s dismissal of the claims that survived preemption and so the case is going back to the Eastern District.

Briefly, the facts are that plaintiff underwent a hip replacement surgery in which his surgeon opted to use a Smith & Nephew device that consisted of several component parts, one of which was the R3 metal liner. Shuker v. Smith & Nephew, PLC, 2018 U.S. App. LEXIS 5160, *11 (3d Cir. Mar. 1, 2018). Unlike the other components of the device, the liner had undergone FDA Pre-Market approval. Id. And, the parties are in agreement that the surgeon’s decision to use the R3 metal liner with this particular device was an off-label use. Id. at *12. Plaintiff suffered complications that required additional revision surgeries.

In its first decision, the district court tossed out almost all claims as preempted and any non-preempted claims for being inadequately pleaded. When plaintiff filed an amended complaint attempting to correct the pleading deficiencies for the non-preempted claims, he again missed the mark and his remaining claims were dismissed with prejudice. The district court also entered a decision finding that it lacked personal jurisdiction over Smith & Nephew, PLC – a foreign parent company. Those three rulings are what the Third Circuit addressed in last week’s decision.

The question of how to apply PMA-preemption to a multi-component device was one of first impression in the Courts of Appeal. Id. at *2. And it is an important question because surgeons engaging in off-label use do mix and match parts with different regulatory backgrounds. The Third Circuit did a precise analysis that landed at the proper conclusion. However, the analysis does start up with a bit of a hiccup. Since we are talking about PMA-preemption, we are dealing with express preemption. Yet, in a footnote the court refused to follow the Supreme Court’s recent abolition of the presumption against preemption in the express preemption context set forth in Puerto Rico v. Franklin Cal. Tax-Free Tr., 136 S.Ct. 1938 (2016), because that decision wasn’t a products liability case and therefore did not directly concern the “historic police powers of the States.” Shuker, at *16n.9. We respectfully disagree with this conclusion for all the reasons we mention in our post discussing Franklin and simply point out that other courts have reached the opposite conclusion. Accord Watson v. Air Methods Corp., 870 F.3d 812, 817 (8th Cir. 2017) (following Franklin and rejecting presumption against preemption in express preemption case); EagleMed LLC v. Cox, 868 F.3d 893, 903, (10th Cir. 2017) (same); Atay v. Cty. of Maui, 842 F.3d 688, 699 (9th Cir. 2016) (same); Conklin v. Medtronic, Inc., ___ P.3d ___, 2017 WL 4682107, at *2 (Ariz. App. Oct. 19, 2017) (under Franklin courts may not invoke a presumption against preemption in PMA preemption cases); Olmstead v. Bayer Corp., 2017 WL 3498696, at *3 n.2 (N.D.N.Y. Aug. 15, 2017) (plaintiff’s assertion of presumption against preemption in PMA preemption case held “frivolous” after Franklin).

Fortunately, that did not derail the Third Circuit from ultimately concluding that plaintiff’s negligence, strict liability, and breach of implied warranty claims were all preempted under Riegel. To do that, the court had to determine to what device it was applying the preemption analysis. Plaintiff argued that you have to look at the device that was implanted as a whole. Whereas defendant, bolstered by an amicus brief filed by the FDA at the court’s request, maintained that the proper focus is on the component of the device with which plaintiff takes issue. Shuker, at *18. Agreeing with the defense position, the court anchored its decision on three findings. First, the FDCA defines “device” to include “components, parts, and accessories.” Id. at *19. Second, the FDCA’s off-label provisions specifically acknowledge that a physician can and will use components separately from the system for which the FDA approved use. Id. at *20. And despite the use to which the component is put, the FDA’s PMA-regulations for the component follow with it. In other words, “premarket approval requirements apply equally to the components, as manufacturers generally may not deviate from the requirements imposed through premarket approval regardless of how [a component] is used.” Id. (citation and quotation marks omitted). Third, the FDA’s position is that the device is not limited to the device as a whole but includes components. Further, the FDA is charged with assuring the safety and effectiveness of components as well as finished devices. Id. at *21-22.

Therefore,

[t]aken together, the statutory definition of “device,” the treatment of off-label uses, and the guidance of the FDA all counsel in favor of scrutinizing hybrid systems at the component-level. . . .. And the Riegel test is properly framed at Step One as “whether the Federal Government has established requirements applicable” to a component of the hybrid system.

Id. at *22-23. Because the part of the device plaintiff attacked was the R3 metal liner which was premarket-approved, any state tort claim that seeks to impose requirements that are different from or in addition to the FDA’s requirements for that component are preempted. That includes plaintiff’s negligence, strict liability, and implied warranty claims.

The appellate court next reviewed the dismissal of plaintiff’s claims that survived preemption – negligence and fraud claims based on alleged off-label promotion in violation of federal law – and found the negligence claim was adequately pleaded but that plaintiff failed again to satisfy Rule 9’s heightened standard for pleading fraud. As to negligence, the court found TwIqbal satisfied as to duty, breach, causation where plaintiff alleged:

  • the R3 metal liner was approved only for use with a different system and therefore under federal law defendant had a duty to refrain from false or misleading advertising;
  • in a press release, defendant misleadingly marketed the R3 metal liner as an option for the system used by plaintiff’s surgeon (one other than the one it was approved for); and
  • plaintiff’s surgeon “either read” or “was aware” of the press release.

Id. at *28-29. Like the district court, the Third Circuit considered and relied upon the press release cited in plaintiff’s complaint. Unlike the district court, the Third Circuit appears to only focus on the portions of the press release upon which plaintiff relied (see prior post for more details) and concludes that’s enough to get plaintiff to the discovery stage. Id. at *29n.18. Although we wonder if the court’s calling plaintiff’s allegations enough to “nudge” the claim over the threshold is a veiled acknowledgement of just how narrowly the complaint squeaked by. See id. at *30.

Meanwhile, plaintiff’s fraud claim needed more than a nudge and it didn’t get even that. The court focused on plaintiff’s failure to plead justifiable reliance on the alleged misrepresentation. The “read” or “was aware” of allegation that sufficed for negligence lacked the requisite details regarding how the press release “induced or influenced” plaintiff’s surgeon for a fraud claim. Id. at *33-34. Plaintiff has to allege the “circumstances of the alleged [influence on Mr. Shuker’s surgeon] with sufficient particularity to place [defendant] on notice of the precise misconduct with which it is charged.” Id. at *34. Despite this having been plaintiff’s second failed attempt at meeting the pleading standard on fraud, the Third Circuit decided to give plaintiff another chance and found the claim should only be dismissed without prejudice.

Finally, there was a separate finding by the district court that it did not have personal jurisdiction over Smith & Nephew, PLC, a foreign parent company. The Third Circuit agreed with the district court that specific personal jurisdiction was not conferred on a stream-of-commerce theory. Id. at *36-37. We’ve talked about this before and more recently in light of BMS v. Superior Court, and like the Third Circuit “we have no cause to revisit” the precedent on the issue (but you should feel free to). But the court did think plaintiff alleged enough in his complaint to allow some limited jurisdictional discovery on possible alter ego based personal jurisdiction. Id. at *38-40. Emphasis on the limited part. See id. at *40n.20 (“District Court should take care to circumscribe the scope of discovery . . . to only the factual questions necessary to determine its jurisdiction;” further referencing proportionality amendment to Rule 26(b)(1)).

So, on the third pass plaintiff got a little life breathed back into this case which is unfortunate, but as the first appellate decision on component preemption – we’ll put it in the win column.

Perhaps you have heard that elections have consequences. That is true not only for high-profile issues that hog the headlines on CNN and Fox News, but it is also true for drug and device litigation regulation. Such drug and device regulation can be just as important, if not considerably more important, than whatever current political claptrap is getting all the bandwidth.  Drug and device availability and innovation actually affects people’s lives regularly and profoundly. Despite the typical claims of plaintiff lawyers at trial, the FDA is not a paper tiger.  The FDA’s actions and attitudes have a huge impact on the industry.  Those attitudes and actions can oscillate with election results. For example, in 2016, the FDA issued 15 warning letters to drug and device manufacturers regarding alleged false or misleading advertising. 2017 saw only three such warning letters and one untitled letter.  Change is in the air.  We did not see any coverage this weekend of the FDA’s January 12, 2018 statement “on FDA decision to seek additional time to reassess rule that would have changed longstanding practices for how the agency determined the ‘intended use’ of medical products.”  Take a look at the FDA’s announcement here:  https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm592358.htm.  If you are a completist, here is the full proposal of delay from the Federal Register:  https://www.federalregister.gov/documents/2018/01/16/2018-00555/clarification-of-when-products-made-or-derived-from-tobacco-are-regulated-as-drugs-devices-or.  Whatever else you might think about the Trump vs. Obama administrations, this rethink is an example of the new FDA leadership doing the right thing.

The background is a bit byzantine.  In the waning days of the Obama administration, on January 9, 2017, the FDA issued a Final Rule on “Clarification of When Products Made or Derived from Tobacco are Regulated as Drugs, Devices, or Combination Products; Amendments to Regulations Regarding ‘Intended Uses.’” That “clarification” was both a trick and a double-cross.  The tobacco features were a distraction from the FDA’s desperate attempt to save its constitutionally-suspect enterprise of clamping down on communications about off-label use of drugs or devices.  As we have described several times before, the FDA’s power to punish off-label promotion rests on a regulatory two-step, whereby off-label promotions are said to prove an indicated use not included in the label and, thus, not accompanied by adequate directions for use – making the product misbranded. Got that? The regulations supporting this tortured logic have been around since the 1950s, but a recent series of court decisions invoking the First Amendment called into question the FDA’s interpretation of “intended use” and its efforts to shut down truthful medical-science communications about potential benefits from off-label use.  In a 2015 proposed rule, the FDA proposed striking the language from the regulations permitting the FDA to consider a manufacturer’s mere knowledge of actual use as evidence of intended use. Good news, right? We thought so.  But not so fast. The FDA’s January 9, 2017 proposal reversed course, retained knowledge of off-label use as evidence of intended use, clarified that any relevant source of evidence, whether circumstantial or direct could demonstrate intended use, and ultimately invoked the dreaded “totality of the evidence” standard.  A constitutionally frail regulatory regime looked like it was about to become even worse – even more vague, over broad, and chilling.

We bemoaned this ugly turn of events, as did many other legal commentators.  Not to take undue credit, but we suspect that the eruption of the legal blogosphere on this issue had a beneficial result.  The incoming Trump administration placed a brief hold on new regulations, and then delayed the “intended use” regulation to March 19, 2018 so that comments could be received and considered.  Did comments pour in?  Yes they did.  Fifteen comments came in.  Two addressed the tobacco issues.  (That portion of the regulation will go forward.)  Thirteen criticized the new broadening of the types of evidence that could be considered in determining intended use.  One of those comments was written by PhRMA.  We summarized that excellent, persuasive comment here.  Read as a whole (or, if you prefer, the totality of the circumstances), the comments made a strong case that the proposed final rule violated the First Amendment, was so vague as to implicate due process, interfered with the practice of medicine, departed from existing statutes, cases, regulations, and past practices, and would have negative health implications.  You all spoke up, and the FDA listened. The bottom line is that the FDA is now proposing to “delay until further notice” the portions of the final rule amending the FDA’s existing regulations describing the types of evidence that may be considered in determining a medical product’s intended uses.  The FDA will receive comments on this proposal through February 5, 2018.  If you haven’t spoken up on this very important issue, speak up now.  How many times in your life and career can you take a position that actually makes a difference, and that both saves lives and free speech?

We sometimes spend time on this blog grousing.  Not this time.  Well done, FDA. Well done, all of you who contributed to the debate.

With PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical Co. v. Bartlett, 133 S. Ct. 2466 (2013), preemption arguments in cases involving generic prescription drugs has become a little like shooting fish in a barrel, as our generic preemption scorecard documents.  Still, that’s no reason not to praise good results.  Recently, the manufacturers of generic amiodarone scored two big wins on the same day.  Moore v. Zydus Pharmaceuticals (USA), Inc., ___ F. Supp.3d ___, 2017 WL 4365162 (E.D. Ky. Sept. 29, 2017); Bean v. Upsher-Smith Pharmaceuticals, Inc., 2017 WL 4348330 (D.S.C. Sept. 29, 2017).  Moore, which is headed for F. Supp. publication, is the more comprehensive case, so we’ll start with it.

The plaintiffs’ pitch, such as it is, in these cases is that the generic defendants either piggybacked on the branded manufacturer’s earlier off-label promotion or else engaged in such promotion themselves.  Secondarily, they claim that they didn’t receive the medication guide that the FDA requires manufacturers of this product to provide to prescribing physicians.  Somehow, the failure of the prescriber to pass along this pamphlet is the manufacturer’s fault.

Didn’t work (mostly) in Moore.  As for the off-label promotion allegations, they were barred – as other information-related claims involving generic products are barred – because “the generic drug manufacturer could not change its labeling without violating FDA regulations.”  Moore, 2017 WL 4365162, at *3 (citing Mensing).  Further, the entire concept of “off-label” is derived from the FDA-approved label, and thus from the Food, Drug & Cosmetic Act (“FDCA”).  Id. at*7.  Plaintiff’s attempt to gin up a state-law negligence claim based on this alleged conduct ran straight into a quirk of Kentucky law that we’ve blogged about before:  Kentucky, by statute, prohibits negligence per se claims based on violations of federal law.

The Kentucky Supreme Court’s holding in T & M Jewelry, Inc. v. Hicks ex rel. Hicks, 189 S.W.3d 526, 530 (Ky. 2006) offers binding and unequivocal precedent concerning the scope of KRS 446.070 and demonstrates that [plaintiff] does not have a state based right to sue for negligence in this matter.

*          *          *          *

Under Kentucky law and the Kentucky Supreme Court’s analysis of KRS 446.070, which codifies the doctrine of negligence per se, . . . the statute “did not intend for KRS 446.070 to … confer a private civil remedy for” violations of federal law.

Moore, 2017 WL 4365162, at *7-8.  Aside from the off-label aspect, all warning claims were preempted under Mensing.  Id. at *8-9.  Plaintiff did not allege design- or manufacturing-related claims.  Id. at *8.

As for the purported failure to supply the FDA-mandated medication guide, that was something that the plaintiff simply made up.  Kentucky, like every other state, follows the learned intermediary rule.  Id. at *6.  The manufacturer thus has no obligation, “non-delegable” or otherwise, to communicate warnings directly to a patient who has been prescribed a drug.  Id.  Because there is no such state-law duty, any obligation to supply medication guides was imposed solely by the FDCA.  The FDCA, however, “leaves no doubt that it is the Federal Government rather than private litigants who are authorized to file suit for noncompliance.”  Id. at *5 (quoting Buckman Co. v. Plaintiffs Legal Committee, 531 U.S. 341, 349 n.4 (2001)).

Since [plaintiff’s] claim concerning receipt of the medication guide exists exclusively due to the federal regulatory scheme, her claim must fail as the cause of action is merely based upon alleged violation of the FDCA and it is the FDA, not [plaintiff], that “has at its disposal a variety of enforcement options that allow it to make a measured response to suspected fraud upon the Administration.”

Id. (again quoting Buckman, 531 U.S. at 349).

Implied warranty claims were preempted for the same reasons as negligence and strict liability claims.  Id. at *9.  Express warranty claims failed because there was nothing the “explicitly warranted” the drug’s safety for the off-label use in question.  Id. at *10.  Without any express language, the warranty claim was simply a doomed repackaging of plaintiff’s preempted warning claim.  Id. at *11.

The only claim that could conceivably survive preemption in Moore was a fraud claim based on false off-label promotion.  As we’ve seen numerous times in PMA preemption, while every other aspect of off-label promotion was protected by preemption, an allegation that was both false and an FDCA violation could survive – if a plaintiff ever properly pleaded it.  The plaintiff in Moore didn’t come close:

The majority of the complaint fails to specify actions undertaken by [defendant] and instead conflates accusations of wrongdoing against the two originally named “Defendants.”  Instead of providing specific details concerning when the wrongful conduct took place, the Complaint alleges that the “Defendants’ scheme in the past involved and continues to involve a calculated and deceitful sales campaign. . . .”

Id. at 12.  The complaint was such a mess that “it is unclear whether providing [plaintiff] with an opportunity to amend her complaint would be futile.”  Id.  The court decided to give her one more shot.  Id.

The second preemption win, Bean, 2017 WL 4348330, was mostly along the same lines, except that, being from South Carolina, the Kentucky quirk on negligence per se wasn’t at issue.  The plaintiff made same the allegations about off-label promotion and medication guides.  Id. at *1-4.  The court was even firmer about preemption, not allowing any loophole for “fraudulent” off-label promotion:

Plaintiff’s “off-label” promotion claims are due to be dismissed as preempted under Mensing and Bartlett. . . .   The basis for Plaintiff’s “off-label” marketing claim is that Defendants, by virtue of their marketing of [the drug off-label], rendered the manufacturer’s warning inadequate.  Defendants are prohibited by the FDCA and FDA regulations from adding or strengthening any warnings for [the drug] to address any risks associated with off-label use.  If successful, Plaintiff’s “off-label” promotion claims would necessarily require Defendants to either: 1) change the warning label or disseminate additional warnings to reflect the alleged additional dangers associated with the “off-label” use of amiodarone for atrial fibrillation; 2) accept state tort liability; or 3) exit the market place. . . .  [S]uch a result requires preemption under Mensing and Bartlett.  Plaintiff’s “off-label” promotion claims, whether sounding in fraud or negligence, are preempted by the FDCA.

Id. at *5.

Also, as in Moore, the medication guide allegations were preempted as private FDCA enforcement under Buckman.  2017 WL 4348330, at *6-7.  Plaintiff didn’t even respond to Buckman, which the court found particularly “telling. Id.; see id. at *7 (“the requirement to provide a Medication Guide to distributors is based solely in the requirements of the FDCA and related regulations”).  The learned intermediary rule, which South Carolina follows, precluded any state-law liability for failing to provide warnings directly to a patient . Id. at *8.  Buckman also did in the off-label promotion claims, because the court found no state-law obligation to avoid off-label promotion.  “[T]he duties Plaintiff alleges Defendants breached regarding ‘off-label’ promotion exist solely under the FDCA.”  Id. at *7.

The court in Bean was particularly unhappy with both plaintiffs’ allegations and with her counsel.  The allegations were inherently inconsistent, because by alleging that the medication guide contained “adequate and sufficient” warnings, the plaintiff necessarily defeated her own allegations.  “Plaintiff does not allege that the prescribing physician did not receive the Medication Guide, was unaware of its contents, or the risk [the guide discussed].”  Id. at *8.  These allegations weren’t “plausible on [their] face” under TwIqbal, because the prescriber received “adequate” warnings.  Id.  As for counsel:

Plaintiff’s failure to respond to the learned intermediary argument is striking because Plaintiff’s counsel has been involved in several other amiodarone cases that were dismissed in part pursuant to the learned intermediary doctrine.

Id. at *7 n.4 (string citation omitted).  Thus, the plaintiff in Bean, unlike the plaintiff in Moore, didn’t deserve – and didn’t get – any chance  to replead.  Id. at *8.

One thing that Moore and Bean exemplify to us is how preemption principles cut across product lines.  As we’ve chronicled, much of the favorable law as to off-label promotion was developed in the context of PMA preemption.  Buckman, of course, was an implied preemption case involving a 510(k) medical device.  Both Moore and Bean employed this precedent to dismiss claims involving generic drugs.  In view of this cross-pollination of defense arguments in preemption cases, we offer one final opportunity for improvement.  As we blogged about at length here, there is an additional Mensing/Bartlett preemption argument whenever off-label warning claims are asserted.  Only the FDA can require warnings about off-label uses.

A specific warning relating to a use not provided for under the “Indications and Usage” section may be required by FDA in accordance with sections 201(n) and 502(a) of the act if the drug is commonly prescribed for a disease or condition and such usage is associated with a clinically significant risk or hazard.

21 C.F.R. §201.57(c)(6)(i) (emphasis added).  See also 21 C.F.R. §201.80(e).   Thus, regardless of anything else, a manufacturer cannot add or alter warnings related to off-label uses without first getting the go ahead from the FDA.  In and of itself, that requires preemption of off-label warning claims under Mensing/Bartlett.  For more details, see the other post.

A defense win anywhere helps defendants everywhere.  Keep winning.

Implied Preemption.  Off-label promotion. TwIqbal.  They make up a core of our posts, yet we never seem to tire of them.  Maybe our readers, especially interlopers from the other side of the v., tire of reading about them, but we can often find a wrinkle in a case that merits our huzzahs or inspires a rant.  Today’s case falls into the praiseworthy category, as the court dismissed a complaint predicated on violations of the FDCA in spite of sympathetic allegations that might have carried the day with some other courts. Markland v. Insys Therapeutics, Inc., — F. Supp. 3d –, 2017 WL 4102300 (M.D. Fla. Sept. 15, 2017), involved the alleged death of a patient as a result of respiratory distress from the defendant’s sublingual spray prescription painkiller drug, which she had started the day before.  Rather than offer the typical product liability claims under Florida law, perhaps because the labeling had extensive warnings on respiratory distress, plaintiff asserted only a claim for negligent marketing.  Calling it “negligent marketing” does not really identify what duty was allegedly breached, whether state law recognizes a claim for such a breach, and such a claim would be preempted.  The allegedly actionable conduct in Markland was promoting the drug for off-label use, like the chronic back pain of plaintiff’s decedent, as opposed to the approved indication for breakthrough pain with cancer.  While we do not know the merits, there were many allegations about off-label promotion, which seem to tie to the conduct at issue in well-publicized federal and state investigations.

Defendants moved to dismiss on various grounds, the most relevant of which (for our purposes) were that there was no claim under Florida law for this conduct and it would be impliedly preempted under Buckman anyway.  These had been hot topics recently in some Florida state and federal cases we have discussed, like Mink (here and here) and Wolicki-Gables, but those dealt with PMA devices and the additional issue of express preemption.  Here, with a prescription drug marketed under an NDA approval, there is no express preemption to navigate, but the plaintiff still had to walk a narrow path to state a claim that would not be impliedly preempted.  As we have said before, we think the appropriate order of analysis here would be the determine if there was a cognizable state law claim asserted and then determine if it was preempted, but the Markland court did not separate out its analysis.  It also did not weigh in on whether the allegations here were of truthful off-label promotion that might implicate First Amendment protection.  Instead, it assumed that the off-label promotion alleged violated the FDCA’s prohibition on misbranding.  2017 WL 4102300, *6 & n.4.

The court could take this approach because the plaintiff’s claim was so squarely focused on alleged violations of the FDCA.  Since Buckman, plaintiffs tend to be a bit cagier in making it look like their claims were not predicated on violations of the FDCA or fraud on the FDA.  The Markland plaintiff, however, labeled the defendant’s alleged conduct as violating the FDCA, “federal law,” and “requirements imposed by the FDA regarding the condition that this drug should be utilized to treat cancer patients with breakthrough cancer pain.” Id. at *9.  “Hence, [the claim], while framed in the language of negligence, appears to derive from [defendant’s] alleged off-label promotion of [the drug]” and “the very concepts of off-label use and off-label marketing are born out of the FDCA.” Id.   This was well phrased, as was the later statement that “it is only because of the existence of the FDCA’s restrictions on off-label marketing that Mr. Markland claims [defendant’s] actions were improper or otherwise violated a duty.” Id.

This is the recipe for implied preemption under Buckman.  It also means there is no negligence claim under Florida law, “which bars plaintiffs from using state negligence actions to seek recovery for FDCA violations.” Id. at 10 (citing negligence per se cases).  Of course, Buckman recognized that the FDCA does not provide for a private right of action, and preempts claims with FDCA violations as “critical element[s],” which should prevent such piggybacking.  So, plaintiff’s case was done and could not be revived by amending the complaint.  In other words, there was no need for a second and third strike before judgment could be entered.  This was so despite the Court’s expression of compassion:

The Court does not question for a moment the grievous nature of Carolyn Markland’s death, nor the deep sadness Mr. Markland must face on a daily basis as a result of his wife’s untimely passing. Nonetheless, the Court must act within the bounds of the law.

Id. at *11.  This a good lesson, especially for courts sitting in diversity, that the law should not be expanded to allow for recovery by sympathetic who cannot make their case under accepted tort theories.

 

Back in 2013, Ramirez v. Medtronic Inc., 961 F. Supp.2d 977 (D. Ariz. 2013), made it to #9 on our worst cases of the year list – which is pretty good (actually, pretty bad) for a trial court decision.  Purporting to apply Stengel v. Medtronic Inc., 704 F.3d 1224, 1228-31 (9th Cir. 2013) (en banc) – an even worse case (#2 on the same list) – Ramirez held, basically, that allegations of off-label use/promotion eliminated preemption altogether, even for Class III pre-market approved products.

When the device is not being used in the manner the FDA pre-approved and the manufacturer is actually promoting such use, there is no law or policy basis on which to pre-empt the application of state law designed to provide that protection.

Id. at 991.

Fortunately, Ramirez has proven to be an outlier, with numerous decisions, several even in the same District of Arizona, considering and rejecting Ramirez’s meat axe approach to preemption.  See Angeles v. Medtronic, Inc., 863 N.W.2d 404, 413 (Minn. App. 2015) (“Ramirez has been rejected by most federal district courts that have reviewed this issue”); Coleman v. Medtronic, Inc., 167 Cal. Rptr.3d 300, 314 (App. 2014) (“[w]e find the approach taken in Ramirez unpersuasive”), app. dismissed & opinion ordered published, 331 P.3d 178 (Cal. 2014); McCormick v. Medtronic, Inc., 101 A.3d 467, 486 n.13 (Md. App. 2014) (“Ramirez has been almost universally rejected”); Shuker v. Smith & Nephew PLC, 211 F. Supp.3d 695, 701 n.5 (E.D. Pa. 2016) (“this Court considered but declined to follow” Ramirez); Jones v. Medtronic, 89 F. Supp.3d 1035, 1051 (D. Ariz. 2015) (“this Court joins the majority of courts in rejecting Ramirez”); Thorn v. Medtronic Sofamor Danek, USA, Inc., 81 F. Supp.3d 619, 627 (W.D. Mich. 2015) (Ramirez “has been rejected by numerous district courts”); Wright v. Medtronic, Inc., 81 F. Supp.3d 600, 610-11 (W.D. Mich. 2015) (same as Thorn); Byrnes v. Small, 60 F. Supp.3d 1289, 1299 (M.D. Fla. 2015) (“the Court disagrees with the reasoning in Ramirez”); Shuker v. Smith & Nephew PLC, 2015 WL 1475368, at *10 (E.D. Pa. March 31, 2015) (“the Ramirez decision has been widely criticized by other district courts reviewing allegations of off-label promotion of PMA-approved devices”); Arvizu v. Medtronic Inc., 41 F. Supp.3d 783, 790. Ariz. 2014) (“the Court finds the reasoning of [decisions rejecting Ramirez] to be more persuasive”); Martin v. Medtronic, Inc., 32 F.Supp.3d 1026, 1036 (D. Ariz. 2014) (“join[ing] the majority of other courts which have rejected Ramirez to the extent that it holds that the preemption analysis does not apply to claims based on off-label promotion”); Beavers-Gabriel v. Medtronic, Inc., 15 F.Supp.3d 1021, 1035 (D. Haw. 2014) (“however, Ramirez has been rejected − for good reason − by numerous courts”); Schouest v. Medtronic, Inc., 13 F. Supp.3d 692, 700 (S.D. Tex. 2014) (Ramirez “read Riegel too narrowly”); Scovil v. Medtronic, Inc., 995 F.Supp.2d 1082, 1096, n.12 (D. Ariz. 2014) (“respectfully disagree[ing] with [the] ruling in Ramirez”); Arthur v. Medtronic, Inc., 2014 WL 3894365, at *5 (E.D. Mo. Aug. 11, 2014) (Ramirez’s “reasoning has been rejected by several courts”); Brady v. Medtronic, Inc., 2014 WL 1377830, at *4 (S.D. Fla. April 8, 2014) (applying “the traditional preemption analysis to [plaintiff’s] off-label marketing claims” contrary to Ramirez); Houston v. Medtronic, Inc., 2014 WL 1364455, at *5 (C.D. Cal. April 2, 2014) (“the Ramirez holding is not consistent with the text of §360k(a), the scope of federal requirements imposed on Class III devices, or Ninth Circuit precedent”); Stephens v. Teva Pharmaceuticals, U.S.A., Inc., 2013 WL 12149265, at *4 (N.D. Ala. Oct. 31, 2013) (Ramirez is “inapposite” and “of no assistance” to plaintiff).

Now the FDA has jumped into the fray, and its view of preemption and allegations of off-label use is no more favorable to Ramirez – and to plaintiffs trying to oust preemption of PMA devices – than these judicial decisions.  The sharpest-eyed of our readers may have noticed the two citations above to relatively recent district court opinions in a case called Shuker.  It so happens that Shuker is currently on appeal, and following oral argument, the Third Circuit Court of Appeals invited the FDA to provide its views on the preemption question.  Last week, the FDA did so.  You can find a copy of the FDA’s amicus brief in Shuker here.

Apparently, in Shuker the plaintiffs allege that the defendant was somehow responsible for Mr. Shuker’s surgeon creating a hybrid hip prosthesis construct that included some components of a Class III PMA system and others belonging to a Class II system cleared under the FDA’s “substantial equivalence” (“§510k”) process.  FDA amicus br. at 3-4.  This hybrid construct was an off-label use.  Id. at 4.  Exactly how the individual Class III and Class II component used in the construct are alleged to have contributed to the plaintiffs’ injuries appears totally unclear, but we do know that the Class III component was later recalled.  Id.

That causes the plaintiffs a big problem. On the one hand, they would love to smear the defendant with the recall, and wave it around like a bloody shirt.  On the other hand, the Class III component – because it was PMA approved – brings the powerful preemption defense into play.  So plaintiffs invoked off-label use to try to have their cake and eat it too.

The FDA did not agree.

Rather, the agency advised that “[t]he district court correctly held that §360k(a) applies to a component of a premarket-approved device even when the component is put to an unapproved use.”  Id. at 6.  First, the FDA clarified the status of device “components” under the FDCA::

The component of the premarket-approved device is itself a “device” under the FDCA, and FDA’s approval imposes device-specific requirements with respect to that component.  The manufacturer generally may not deviate from those requirements without prior approval from FDA, regardless of the uses to which the component may be put by third parties.  Because the component is subject to device-specific federal requirements, §360k(a) expressly preempts any state requirements “with respect to” the component that are “different from, or in addition to,” those device-specific federal requirements.

Id. (emphasis added).  Thus, all components of a pre-market approved device system are themselves PMA devices for preemption purposes, and that status doesn’t change because of off-label use.

With respect to other components, if they are “not subject to device-specific federal requirements,” then they are “outside the scope of §360k(a),” and claims limited to them “are not expressly preempted.”  Id.  To the extent those components are §510k cleared, they “generally” (but apparently not necessarily always) not entitled to preemption.  Id. at 7.

The fact that off-label use (which the FDA calls “unapproved use” in its letter) is possible for a device does not allow – let alone allow the common law to require – a manufacturer of a PMA device to change its design or labeling (read: warnings) or manufacturing processes without prior FDA approval:

As a general matter, the device-specific requirements that attach to a medical device through premarket approval apply even when the device is put to an unapproved use.  Once a device receives premarket approval, the FDCA generally prohibits the manufacturer from making, without FDA permission, changes that would affect the safety or effectiveness of the device. . . .  Those requirements apply irrespective of the use to which the device is ultimately put.  The possibility that a physician may choose to use a device for an unapproved purpose − something the FDCA contemplates, see 21 U.S.C. §396 − does not authorize a manufacturer to vary the design, the manufacture, or (with limited exceptions) the labeling of the device in anticipation of that use.  Such variation would violate federal law.

Id. (emphasis added).  Thus, the general rule that alterations that significantly affect a device’s “safety or effectiveness” require FDA preapproval exists “irrespective” of off-label use.

The FDA observed that “most” courts recognize that PMA imposes “requirements” – and therefore preemption – on medical devices “even when the device is put to an unapproved [off-label] use.”  Id. at 7-8 (citations omitted).  The agency also recognized something this Blog has repeatedly pointed out, that Riegel v. Medtronic, Inc., 552 U.S. 312 (2008), the case in which the United States Supreme Court recognized broad PMA preemption, itself involved an off-label use.  FDA amicus br. at 8 (“Riegel itself involved an off-label use of the device in question”).  The FDA advised that, “[s]imply put, once a device receives premarket approval, it remains subject to federal requirements for purposes of §360k(a) regardless of how it is used.”  Id.

Nor did it matter that the off-label use was only of a “component” rather than of an entire device system. The PMA “requirements” applicable to that component as a “device” “apply equally when third parties put the [component] to an unapproved use with components of another device” even if the other device is §510(k) cleared. Id.

Defendants generally may not deviate from the requirements imposed through premarket approval regardless of how the liner is used.  Claims touching on those requirements therefore implicate §360k(a) even when a component of an approved device is put to the type of unapproved use here at issue.

Id.

Preemption of such claims is not only the law, but is good policy:

The conclusion that §360k(a) applies in this context also makes sense as a matter of policy.  Congress entrusted FDA with determining which device designs should be approved for marketing, as well as how approved devices should be labeled to provide medical professionals with appropriate safety information.  Section 360k(a) acknowledges FDA’s judgment in this respect and prevents States from pursuing competing judgments that would impose different or additional requirements on approved devices.  That provision also protects manufacturers that have complied with detailed federal requirements from being subjected to liability under state law for doing what federal law required.  Manufacturers must generally adhere to the specifications established through premarket approval, even if healthcare practitioners subsequently exercise their judgment and employ the device for an unapproved use.

Id. at 9 (emphasis added).  The FDA recognized the precedent cited at the beginning of this post – those cases criticizing Ramirez – as being “consistent” with the Agency’s preemption analysis.  Id.

Thus, the FDA advised that plaintiffs can’t go after the recalled PMA component, but are limited to claims concerning the non-PMA components of the construct only.  Id. at 10 (“§360k(a) requires a court to parse a plaintiff’s claims to determine whether the state-law requirements that underlie them are indeed directed at the premarket-approved component”).  “[A] component that did not receive premarket approval and is not otherwise subject to device-specific federal requirements” is not subject to express preemption under §360k(a).  The FDA “t[oo]k[] no position” on whether such claims were actually alleged, although they conceivably could be.  Id. at 12.

As for implied preemption, the FDA noted that “defendants did not raise implied preemption in their dispositive motions below, nor . . . in their original appellate briefing.” FDA amicus br. at 13.  Assuming that implied preemption was nonetheless at issue, the Agency confirmed:

[T]he existence of an express-preemption provision such as §360k(a) does not ordinarily alter the normal operation of implied-preemption principles.  Accordingly, state-law medical-device claims that are not expressly preempted remain subject to challenge on implied preemption grounds

Id. (citing Buckman Co. v. Plaintiffs Legal Committee, 531 U.S. 341, 352 (2001)).

The FDA then briefly explored what many courts (but not the FDA) have called the “narrow gap” between express and implied preemption in PMA cases.  Implied preemption impacts two types of claims that are not expressly preempted:  (1) “parallel” claims; and (2) claims concerning “generally applicable federal requirements that do not trigger the operation of §360(k).”  FDA amicus br. at 14.  Purportedly parallel claims are preempted when they “have features that intrude impermissibly on the operation or enforcement of the FDCA, as where they represent an attempt to enforce the federal scheme, rather than asserting independent state-law requirements.”  Id.  As for “generally applicable” claims, “on a case-by-case basis,” “divergent state requirements may stand as an obstacle to the operation or objectives of the federal scheme and may be impliedly preempted on that basis.”  Id.  The FDA did not get any more specific than that as to implied preemption, noting instead that failure to report claims had been dismissed as inadequately pleaded, and therefore avoiding that issue.  Id. at 14 n.7.

What takeaways can we, as defense counsel, extract from the FDA’s filing? How about these:

  • Ramirez was wrongly decided. Off-label use does not affect the applicability of preemption at all. FDA amicus br. at 6-9.
  • PMA preemption applies to PMA components – period.  Id. at 7-10.
  • “[T]he FDCA generally prohibits the manufacturer from making, without FDA permission, changes that would affect the safety or effectiveness of the device.”  Id. at 7. That should help with Mensing/Bartlett preemption.
  • Implied preemption operates independently of express preemption, so that manufacturers of devices not subject express preemption under §360k(a) can still assert implied preemption “on a case-by-case basis.”  Id. at 14.  Also good for Mensing/Bartlett, particularly in the device context.
  • Ostensibly “parallel” claims are preempted where they “intrude impermissibly on the operation or enforcement of the FDCA.”  Id.  The FDA likes Buckman.
  • No state generally bans off-label promotion, only the FDCA, so “promotion” based claims involving off-label use are likely to be impliedly preempted.  In fact, we just saw another one of these the other day.  See Markland v. Insys Therapeutics, Inc., 2017 WL 4102300, at *9 (M.D. Fla. Sept. 15, 2017).
  • The FDA twice carefully qualified its discussion of §510(k) devices, recognizing that express preemption could exist where such a device was “otherwise subject to device-specific federal requirements.”  FDA Amicus br. at 6, 12. Good for limiting Lohr “on a case-by-case” basis.

The beast part may be a bit of an exaggeration, but it serves the purpose of depicting what at least on the surface are two very opposite things. But if you delve more deeply, you find a lot of similarities. So many similarities that the two things shouldn’t really be opposites at all. That’s what happens in the fairy tale. The beast is really a prince. But life’s not a fairy tale. And neither is pharmaceutical litigation. And if it were, it wouldn’t be a Disney version, it would be one of those original Grimm Brothers’ stories – the dark and twisty ones. And that’s what we have today. Two cases that come to opposite conclusions but based on the same allegations about the same failure to warn about the same drug. We should be talking about a beauty and a prince. Instead we have a beauty and a beast . . . or at least maybe a frog.

Within two days of each other, two decisions were handed down in cases involving the generic prescription drug amiodarone manufactured by the same company – Hernandez v. Sandoz Inc.,  2017 U.S. Dist. LEXIS 120938 (N.D. Ill. Aug 1, 2017) and Tutwiler v. Sandoz Inc., 2017 WL 3315381 (N.D. Ala. Aug. 3, 2017). Both were second bites of the apple. In Hernandez, defendants moved for reconsideration of the court’s prior ruling rejecting preemption and allowing a failure to warn claim premised on defendants’ failure to provide medication guides per federal regulations. We blogged about that earlier decision here. In Tutwiler, the court had previously dismissed that same claim but plaintiff included it in her amended complaint. Defendants moved to dismiss again. Both courts stuck to their prior decisions.

Our prior post on Hernandez explains how we think the court got preemption wrong – notably by applying the Seventh Circuit’s awful PMA, medical device express preemption decision in Bausch v. Stryker to a pharmaceutical drug case and finding a parallel violation claim. On reconsideration, defendants argued that the court misapplied Bausch. In response, the court cited other district courts within the Seventh Circuit to also have applied Bausch to pharmaceutical cases, including another amiodarone case that we blogged about here. Hernandez, at *5-7. The old adage two wrongs don’t make a right comes to mind.

Unable to make the court see that this is really an implied preemption case – plaintiff was seeking to enforce an FDCA requirement regarding distribution of medication guides – defendants were left to argue that the claim isn’t really parallel to a state law duty to warn. There is no Illinois state law duty to warn pharmacists so they can in turn warn consumers. In fact, in prescription drug cases, the manufacturer’s duty is to warn the prescribing physician – not the consumer. Id. at *9n.4. From the court’s description of plaintiff’s allegations, plaintiff alleges both traditional failure to warn the prescriber and failure to warn the consumer by failing to provide medication guides. Id. at *9. The court then seems to conflate all those allegations into one plausible failure to warn claim. See id. (“The court remains convinced that plaintiff has sufficiently alleged each of the elements necessary to establish a failure to warn claim under Illinois law despite focusing much of his complaint on his allegations that defendant’s actions violated the FDCA.”). By alleging both failure to comply with the FDCA and failure to warn the prescriber plaintiff got to dodge both preemption and learned intermediary. But those are two separate claims and they should both fail.

And that’s how you turn the beast/frog into a prince. You apply both preemption and learned intermediary like in Tutwiler. First, in this case the court already dismissed plaintiff’s traditional failure to warn claim – the failure to warn plaintiff’s prescriber – under Mensing. These are after all generic prescription drugs and the Supreme Court has said they don’t survive conflict preemption. Which is presumably why plaintiffs in these cases are focused on the medication guide allegation. In Tutwiler, plaintiffs argued that failure to provide the medication violated the “duty of sameness” on which Mensing rests making Mensing inapplicable. Id. at *2. As we noted above, failure to warn based on failing to adhere to an FDCA requirement should also be impliedly preempted under Buckman or the prohibition of private causes of action to enforce the FDCA.

But the Tutwiler court said it didn’t need to consider preemption because the claim is barred by the learned intermediary doctrine. In Alabama, like in Illinois, in a prescription drug the case the duty to warn runs to the physician. Id.

[I]t does not follow . . . that if the manufacturer inadequately warns the physician, it owes an independent duty to warn the patient directly. This is the reason why this Court previously stated that “it appears unlikely that Plaintiff can state a failure-to-warn claim based on Defendant’s failure to provide a Medication Guide to her pharmacy that avoids the application of both the learned-intermediary doctrine and Mensing.”

Id. And there’s the beauty.

There is one thing that both Hernandez and Tutwiler agree on – plaintiffs’ off-label promotion claims are fraud claims that must be pleaded to the heightened standard required by Federal Rule of Civil Procedure 9(b). Both plaintiffs tried to argue that these were negligent marketing claims. Hernandez, at *3; Tutwiler, at *2. But both courts were unpersuaded by those labels given the context of the allegations. Hernandez, at *4 (“Plaintiff’s complaint is a sprawling and, at times, confusing collection of largely unnecessary allegations that, for the most part, seem to attempt to assert a fraudulent misrepresentation claim as it relates to off-label promotion.”; Tutwiler, at *2 (Plaintiff “claims that Defendant engaged in a ‘concerted and systemic effort to persuade physicians’ . . . that the drug was safe and efficacious for off-label uses). Plaintiff Hernandez is getting another chance to re-plead his fraud claims with specificity. Since this was Plaintiff Tutwiler’s second attempt, and her complaint still failed “to identify a single statement in any promotional material to support [Plaintiff’s] contention that Defendant unlawfully promoted amiodarone for [an off-label use],” her claim is dismissed.

They say beauty is fleeting – and so too is a beautiful case. The beast/frog on the other hand lives to see another day.


Last week, we summarized PhRMA’s comments on the FDA’s proposed amendments to regulations regarding “intended uses.”  PhRMA showed how the FDA’s insistence that it could read manufacturer’s minds about intended uses made no sense on an evidentiary basis and ran afoul of First Amendment considerations.  Today, we’ll tip our cyber caps to the Advanced Medical Technology Association (AdvaMed), which also issued well thought-out comments on the FDA’s proposal.  You can read the AdvaMed July 18, 2017 comments here

 

To begin with, the AdvaMed letter excels at doing that thing that judges yell at dumb litigators for not doing in their motions — stating what relief is sought.  AdvaMed puts it plainly: “FDA should abandon the Final Rule and instead return to its original and unambiguous proposal to remove the reference to ‘knowledge’ as set forth in FDA’s September 25, 2015 proposed rule regarding the definition of ‘intended uses.’”  What’s wrong with the FDA’s proposed rule?  It’s bad in its totality, including its reliance the “totality of the evidence” standard.  AdvaMed correctly states that “the ‘totality of the evidence’ standard is more outcome determinative than prescriptive.”  We are reminded of how Justice Black called judicial balancing tests pretentious cover-ups for courts doing whatever they felt like doing.  A totality of the evidence test would mean that the FDA would administer rough justice on a case-by-case basis, sans principle and sans predictability. 

 

That lack of predictability is particularly pernicious where the chilled communications are so critical to public health.  AdvaMed provides concrete examples of communications pertaining to both approved and unapproved medical devices that any right-minded person (and any person who thinks they might someday benefit from advanced drugs and devices – that is, everyone) would favor.  Such communications include training and technical support, educational meetings about clinical trials and development data, feedback from doctors on investigational development, information about real-world experiences with devices, and engagement with health care professionals on device innovation and improvement.  Plaintiff lawyers love to say that drug and device manufacturers have a duty to be the foremost experts on their own products.  The communications potentially chilled by the FDA’s vague, overbroad content-less regulation on “intended uses” are all necessary to facilitate such expertise.        

 

AdvaMed makes the same constitutional argument that PhRMA made, though with some different wrinkles.  AdvaMed discusses the Washington Legal Foundation case from 1998.  The FDA, which raps companies on the knuckles if they are poor at signal detection, should have seen that 1998 case as a very clear signal that its chokehold on truthful off-label communications was unconstitutional.  AdvaMed also does a fine job of applying the Central Hudson requirement that regulation of commercial speech must be narrowly-tailored to serve the governmental interest.   In its request for comments on the proposed rule, the FDA supplied examples of speech restrictions that mostly related to “activities and communications involving the distribution or promotion of illicit drugs.”  There are already non-speech sanctions (including the Controlled Substances act, as well as mail or wire fraud statutes) available to address such criminal activity. 

 

For one brief moment of lucidity, the FDA recognized that a manufacturer’s knowledge that a third party was using a product off-label was not the same thing as the manufacturer’s intent that such product be used off-label.  Then the FDA reversed field, and now we have this new proposed rule.  AdvaMed makes clear that “it is inappropriate to hold manufacturers responsible for the use of their products by third parties over whom they have no control.”  Fairness says as much.  So does a concern for unintended consequences.  The FDA has more than once acknowledged that collaboration between manufacturers and health care practitioners is essential to help develop new life-enhancing or –saving products.  But if manufacturers will be put on the hook for everything they know such collaborators are doing, how can the nature or frequency of such collaboration be unaffected?      

 

AdvaMed concludes its comments with a request that, if the FDA won’t do the right thing and completely back off its wrong-headed “totality of the evidence” test, it should at least issue three clarifications of what would NOT show an intended use: (1) legitimate scientific exchange, (2) truthful, nonmisleading communications, and (3) mere knowledge of third party unapproved uses.  In short, the AdvaMed comments are everything the FDA’s proposed rule is not: clear, fair, and protective of speech and scientific development.