FDA Announces Yet Another Off-Label Promotion Settlement
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Who needs a Super Committee? It seems the Food and Drug Administration has a plan to close the budget deficit all on it's own. Yesterday, the agency announced it had reached an agreement with Merck to pay $950 million in order to settle criminal and civil charges that the company illegally promoted Vioxx for off-label uses and for misrepresenting the drug's risks. That comes on the heels of a $3 billion settlement by GlaxoSmithKline earlier this month.

Now, with all due respect to the memory of Everett Dirksen, a billion here and a billion there isn't even real money in this day and age. But with Pfizer, Eli Lilly, AstraZeneca, GSK, and now Merck all having paid at least half a billion dollars in fines for off-label promotion in the past three years, it seems as though the FDA is on a one-agency revenue raising mission. And if that happens to also put a beat down on the pharmaceutical industry, I'm sure there are folks in the agency who feel that's all well and good too.

"Well, wait a second there!" you might be tempted to say. Doesn't the FDA have good reason to ban off-label promotion? After all, those ARE uses that the agency has never certified as safe and effective.

The problem is that FDA bans not just false or misleading claims about an off-label use's safety and efficacy. That is, it's not just preventing snake oil salesmen from peddling quick fixes that don't work. The agency bans all promotion of off-label uses, even if those uses have been proven to be safe and effective in clinical trials. Even if those uses are considered to be the standard of care for a given ailment. And even if a physician could be liable for malpractice for not administering a drug off-label.

In a 1998 court case, the FDA argued in federal court that off-label promotion was inherently false or misleading because physicians would never be able to tell whether there was sufficient evidence supporting the safety and efficacy of a given drug use unless the agency approved that use. The judge laughed off the claim by writing that the "FDA exaggerates its overall place in the universe." After all, the court continued,

"the FDA does not question a physician's evaluative skills when an article about an off-label use appears among a group of articles in the New England Journal of Medicine, or when one physician refers a peer physician to a published article he recently perused, or even when a physician requests a reprint from a manufacturer. Why the ability of a doctor to critically evaluate scientific findings depends upon how the article got into the physician's hands . . . is unclear to this court."

Few would argue that false or misleading claims in a commercial context should be protected by the First Amendment. However, a few decades worth of now-well established case law concludes that government may not categorically bar truthful and non-misleading speech simply because its purpose is to promote a commercial transaction. Instead, the government must have a substantial interest in regulating the speech in question, and the regulation must directly advance that governmental interest and be no more extensive than necessary to do so.

Under that rule governing commercial speech regulation, you can imagine that there are lots of ways the FDA could go about regulating off-label promotion without banning it outright. Indeed, the current rules make a distinction between "promotional" speech, which the agency argues is illegal, and "educational" speech, which the agency says is not. That's one reason why drug makers may legally distribute peer-reviewed medical journal articles discussing off-label uses under very tightly limited circumstances. (For example, neither the article nor the underlying research, may have been funded in any way by the manufacturer. And, if a different published article suggests that the proposed off-label use is unsafe or ineffective, the manufacturer must include a copy of that too.)

Unfortunately, the FDA's regulations are so unclear that even legal experts don't know what constitutes "educational" speech and what constitutes "promotion". So, no one seems to know just what is permitted and what is not, which seems precisely to be the agency's goal. Facing the threat of severe civil and criminal penalties, drug firms are reluctant to test the boundaries. And when the FDA presses charges for off-label promotion, there is a huge incentive to settle the claim so key executives can avoid jail time. Thus, the lack of clarity prevents manufacturers from exercising the full extent of their constitutional rights.

It's also worth noting that, until the Washington Legal Foundation challenged the off-label promotion ban in court, the agency wasn't even willing to acknowledge that the distribution of peer reviewed journal articles was constitutionally protected. It only did so after losing at the trial court level -- changing it's interpretation of the statute on appeal in order to moot the constitutional question. But the U.S. Supreme Court has held on several occasions -- most recently in the Sorrell v. IMS case decided in June -- that truthful speech used in pharmaceutical marketing is entitled to the same level of First Amendment protection as other commercial speech.

As I discussed in this law journal article earlier this year, I think extant First Amendment case law does provide a significant window for the FDA to regulate off-label promotion. But the agency's outright ban on nearly all manufacturer speech about off-label uses cannot survive a constitutional challenge.

The Merck settlement announced yesterday includes not just off-label promotion claims, but also allegations that the company actively misrepresented the safety of Vioxx. We don't yet have all the details, so it may well be that Merck did in fact engage in false or misleading speech that the First Amendment should not protect. But there are other cases now being litigated in which there are no such ambiguities (see here, for example). And, with the FDA becoming more aggressive in prosecuting off-label cases, we may soon have an opportunity for this question to be resolved in court.

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