FDA Settlement With Amarin May Limit Impact on Policy

Stay ahead of developments in federal and state health care law, regulation and transactions with timely, expert news and analysis.

By Dana A. Elfin

March 8 — The FDA's recent settlement of a lawsuit challenging agency regulations on off-label drug promotion may limit its impact, FDA legal experts said.

Amarin Pharma Inc. announced March 8 that it reached a settlement with the FDA over the agency's restrictions on what it could tell doctors about the off-label uses of its high triglyceride treatment Vascepa (icosapent ethyl) capsules.

Settlement Limits Impact?

Because the agency settled the Amarin case, the policy and enforcement impact beyond the Amarin case itself is likely to be limited, several attorneys told Bloomberg BNA.

The agency's settlement with Amarin isn't “an indication that it intends to alter its stance with respect to other drug and device companies,” Richard A. Samp, chief counsel of the Washington Legal Foundation, told Bloomberg BNA in a March 8 e-mail. WLF is a Washington-based public interest group with a free-market/free-enterprise orientation. WLF has been the named plaintiff in several cases challenging government policy on off-label promotion.

“Indeed, it probably is settling precisely because it doesn’t want to alter its stance—settling limits the damage to this case alone,” Samp said.

“When other companies cite the district court’s opinion in support of their own claims, the FDA will argue that the Amarin case was factually distinguishable, and that the plaintiffs’ claims are at least potentially misleading,” Samp added.

Attorney Bert W. Rein, of Wiley Rein LLP in Washington, agreed. “The agency already has made clear that it accepts this result only for the specific case and is not prepared to modify its overall policy stance because of this settlement,” he told Bloomberg BNA in a March 9 e-mail.

Under long-standing Food and Drug Administration policy, companies can be subject to criminal prosecution and civil liability if they promote their products for uses that the FDA hasn’t specifically approved. Off-label marketing investigations have fattened government coffers over the past decade, bringing in billions of dollars in settlements and fines.

Government's Approach Affected?

But some attorneys tell Bloomberg BNA that the Amarin litigation—and now the settlement—has already affected and will continue to affect the government's approach to off-label issues.

“This settlement represents a significant final chapter in a case that has dramatically impacted the FDA enforcement landscape,” Jennifer L. Bragg, a former FDA counsel now with Skadden in Washington, said March 8.

“The Amarin settlement clearly reflects that the FDA has changed its off-label policy,” Joseph D. Lipchitz, of Mintz, Levin in Boston, told Bloomberg BNA in a March 9 e-mail.

“It is a significant First Amendment victory curtailing the government’s prior policy of suppressing and, indeed, criminalizing truthful speech when it comes to off-label marketing by pharmaceutical and medical device companies,” Lipchitz said. “Truthful and non-misleading speech cannot legitimately be prohibited under the FDCA [Federal Food, Drug, and Cosmetic Act]. ”

Moreover, Lipchitz said, there is evidence that the government has softened its off-label policy stance during the course of the Amarin litigation.

Has Tone Changed?

The FDA’s and Department of Justice's “tone on this issue has changed markedly since the time the court issued its preliminary injunction decision [in the Amarin case] last summer,” Lipchitz said.

For example, he said, in a recent criminal off-label promotion case involving device company Vascular Solutions Inc. and its chief executive officer, the government submitted proposed jury instructions that expressly acknowledged that it wasn't a crime for a device company or its representatives to give doctors wholly truthful and non-misleading information about the approved use of a device .

“This was a significant change, given that the FDA for decades had drawn a hard line that pharmaceutical and medical device companies could not engage in any off-label marketing regardless of whether it involved completely truthful speech,” he said.

And Rein said the FDA's resolution of the Amarin case could lead the agency to be “more cautious in invoking misbranding against off-label speech, particularly because it shifts the burden of showing speech to be false or misleading to the government.”

“The settlement at least implicitly acknowledges that the First Amendment precludes FDA from sanctioning speech related to off-label uses unless it is false or misleading,” he said.

Future Isn't Clear

Nonetheless, the future for off-label policy, government enforcement and even private party actions is far from clear.

“For years, FDA has been pursuing a litigation strategy of ‘live to fight another day', ” by settling every case raising First Amendment issues and then continuing to fight, Paul E. Kalb and Coleen Klasmeier, of Sidley Austin LLP in Washington, said. “It has still not come to grips with the implications of the First Amendment at a policy level,” they said.

Kalb and Klasmeier, who was formerly at the FDA’s Office of Chief Counsel, predicted that both the FDA and whistle-blowers pursuing off-label cases will try to work around these issues by alleging that promotional statements are false or misleading. “That is the next battleground,” they said.

If the Amarin settlement is ultimately accepted as a road map for future cases, then future cases should be limited to situations in which the government can prove deception, Kalb and Klasmeier said.

But open questions remain “regarding whether, and how, FDA and DOJ will pursue misbranding cases involving off-label promotion,” Bragg said in an e-mail. “That result is yet to be seen,” she said.

In an earlier case known as Caronia, the U.S. Court of Appeals for the Second Circuit held that the government can't prosecute a manufacturer for misbranding under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug . The appeals court found that the criminalization of truthful, nonmisleading promotion of FDA-approved pharmaceuticals violated the First Amendment. In addition, the appeals court reversed the conviction of a pharmaceutical company sales representative for promotion of an unapproved use of a drug.

The FDA argued that Caronia was limited to the facts of that particular case.

According to Samp, it's the Caronia decision rather than the Amarin settlement that's likely to prove the most troubling for the government.

“I suspect that going forward, the FDA will have much more difficulty explaining away the decision,” he said.

But Lipchitz said nobody should “expect the government to back away from investigating and, if appropriate, prosecuting what it deems to be ‘misleading' speech.” Indeed, he said, “companies would be well-advised to run their proposed off-label marketing material by the FDA to gain pre-clearance.”

Small Effect on False Claims Predicted

With regard to off-label cases brought under the False Claims Act, Samp said the Amarin case is likely to have only a limited application.

“In FCA cases, the principal issue is whether the off-label use at issue is properly reimbursable, not whether the off-label claims themselves are truthful,” Samp said. “If the use is not reimbursable, then drug companies can be charged with ‘causing' pharmacies or hospitals to falsely seek reimbursement for a nonreimbursable use.”

“The problem for drug companies is that they can’t really afford to fight once the FDA has decided to file an FCA claim against them,” Samp said. “Such fights amount to bet-the-company gambles,” he said, because if the company loses, it would be barred from all federal medical programs. “Stockholders would never permit management to make such a wager in defense of First Amendment principles,” he said.

If Amarin has any impact on FCA cases, he said, it will be in private relator lawsuits in which the federal government has decided not to intervene.

To contact the reporter on this story: Dana A. Elfin in Washington at delfin@bna.com

To contact the editor responsible for this story: Lee Barnes at lbarnes@bna.com

For More Information

A copy of the settlement is at http://src.bna.com/c9L.

Request Health Care on Bloomberg Law