In representing pharmaceutical manufacturers against product liability claims, a common claim we see is that the manufacturer failed to warn the consumer about some side effect or unintended result of using the medicine. One of our standard first-line arguments against that claim is that the lawsuit is “preempted” by federal law. That is, the federal government has chosen to dictate the rules to drug companies and keep the states from interfering with that area. Thus, where the Food and Drug Administration (“FDA”) regulates a medicine and specifies the required warnings to accompany it, any judgment against the manufacturer based on state law could impose requirements that are “different than or in addition to” the FDA’s requirements.
Because it would be literally “impossible” to comply with both federal regulations and a determination of liability under state law, courts are obligated to dismiss such suits and leave label changes to the FDA. This is sometimes the case with brand name drug makers, but recent cases have shown that those manufacturers do have a limited realm of authority to make certain changes to their label. Where the innovator has some power over its label, a state-law-based tort suit can sometimes proceed.
Generic manufacturers, however, have no power to change their label. So when a generic maker raises preemption, it usually enjoys an early dismissal. In recent lawsuits, however, a new wrinkle has developed – one that has at least plausibly threatened generics with potential tort liability. So far, this plausible threat has not manifested itself in any meaningful way. Nonetheless, counsel who represent drug companies should be aware of this new trend and be prepared to counter it. Perhaps more importantly, counsel must be aware of a proposed rule being considered by the FDA that would dramatically alter the landscape of generic pharmaceutical litigation.
First, some background and important terms. A brand name drug receives FDA approval only after it has submitted to that agency a suitable New Drug Application (“NDA”). This is an overwhelming, timely and costly burden to surmount. When you read of companies spending millions on research and development, it is usually not only to create the new drug but to also successfully submit an NDA.
Manufacturers who later wish to create their own version of that same medicine do not have to go through the same rigorous process but may simply file an Abbreviated New Drug Application (“ANDA”) with FDA. When you hear about a “generic” drug, this is a medicine that was approved by FDA through the less rigorous ANDA process.
Now for another term. When a brand name medicine is approved, it usually takes on a second role as a Reference Listed Drug (“RLD”). This is a “gold standard” of sorts; a law passed by Congress requires generic medicines to be the same as the RLD in formulation, labeling, etc. Traditionally, an RLD designation has been more important to the generic maker’s in-house operations. However, it has recently started to take on a larger role in litigation as well.
Here’s the twist and why the FDA’s RLD designation is factoring into litigation more often: Sometimes FDA designates a generic as the RLD. This can happen in several ways.
- Sometimes the innovator who created the brand name drug decides to pull it from the market – perhaps because the cost to manufacture has become prohibitive after patent protection has expired or the market has shown a preference for the generic.
- Sometimes the brand name drug even remains on the market, but a generic manufacturer simply formulates that medicine at a different strength, or in a different route of administration, than that of the approved brand name drug. In those cases, sometimes the FDA re-designates the market-leading generic as the RLD or, in the case of a new strength/route, names the generic as another RLD.
- Sometimes the FDA doesn’t even have a perceptible reason for this designation, and the choice seems positively nonsensical. Regardless of reason, the outcome of this decision is that a generic product, that owes a “duty of sameness” to mirror the RLD, now suddenly is the RLD.
Plaintiff’s lawyers have begun to seize upon this trend. If the generic is the RLD, they reason, it obviously has some power to modify its label and therefore can no longer hide behind the preemption defense. This approach is quite crafty and almost seems logical. But not only have the courts rejected this, so has the FDA.
Frankly, the FDA seems to have definitively spoken on this way back in 2007. The story behind its decision that year is somewhat fascinating, but entirely irrelevant to this post. Regardless, the FDA noted that a brand name innovator had pulled its drug, but noted that “an approved generic” was now the replacement RLD. FDA, Determination that Brethine (Terbutaline Sulfate) Injection was not Withdrawn from Sale for Reasons of Safety or Effectiveness, 72 Fed. Reg. 39630 (July 19, 2007). The FDA pointed to itself, however, not the new RLD, as the entity with the power to order changes to the drug labeling.
Since then, numerous courts have favorably pointed to that 2007 decision as proof that the FDA retains the responsibility to initiate labeling changes. A federal court in Louisiana recently spoke directly to this plaintiff’s theory: “[The generic maker] does not hold NDA status by virtue of becoming an RLD and thus does not bear the burden of its brand name counterpart. It is the FDA that is responsible for mandating changes in labeling, and as Mensing required, NDA-approved drug makers alone retain duties above and beyond those of generic drug makers.” Cooper v. Wyeth, 2012 WL 733846, at *8 (M.D. La. 2012) (unpublished).
In July 2013, the FDA again doubled down on this approach, saying that generic makers still have no power to unilaterally change their labels. Guidance for Industry: Safety Labeling Changes – Implementation of Section 505(o)(4) of the FD&C Act (July 2013). Since then, even the appellate courts have begun to chime their agreement with the FDA and many lower courts. The Sixth Circuit recently observed that “every federal court to consider this issue has held that FDA’s designation of a generic manufacturer’s drug as the RLD does not subject an ANDA product to NDA, or brand name, status or requirements.” In re Darvocet, Darvon, & Propoxyphene Prod. Liab. Litig., 756 F.3d 917, 934 (6th Cir. 2014).
Despite all of this sunny news, there are two potential dangers for generic drug manufacturers. The first is a single, solitary case from Pennsylvania. There, the state’s Supreme Court held that a generic manufacturer had not established with certainty that it was “impossible” to unilaterally modify its label. In re Reglan/Metoclopramide Litig., 74 A.3d 221 (Penn. 2012). The Court did, however, bemoan the absence of useful evidence. This decision has not been favorably cited, but defense counsel should be aware of it and be prepared to distinguish it.
Another looming danger, by far the more worrisome of the two, is a proposal from the FDA that would affect every single generic manufacturer. The agency’s proposed rule would require all generics to propose labeling changes to the FDA in the same way that brand name innovators do. Supplemental Applications Proposing Labeling Changes for Approved Drugs and Biological Products, 78 Fed. Reg. 67985.
The FDA has certainly heard from many critics, who note that this would create troublesome confusion between generics and brand name drugs, as well as between competing generic drugs, and would drive up the price of those medicines. Other critics note that the FDA does not even have the power to issue such a rule, because it would violate generic manufacturers’ “duty of sameness,” which is imposed by statute and not simply by regulation.
Regardless, the FDA will finalize its rule later this year, most likely in July. If it issues the rule as proposed, generic manufacturers will face substantial challenges in increasing their vigilant monitoring of adverse effects and troublesome reactions to their pharmaceuticals. We will, as always, continue to monitor this situation.