Friday, December 16, 2016

Second Circuit will trust FDA on drug facts, not on misleadingness

Church & Dwight Co., Inc. v. SPD Swiss Precision Diagnostics, GmBH, 2016 WL 7131177, No. 15-2411, -- F.3d – (2d Cir. 2016) (as amended on denial of reh’g Dec. 5, 2016)

Original opinion discussed here; the court amended the opinion to deal more explicitly with a couple of issues.  In particular, the original opinion said that the Second Circuit hadn’t settled on a definition of materiality, but presumed that materiality required that the deception be “likely to influence [consumer] purchasing decisions.” Apotex Inc. v. Acorda Therapeutics, Inc., 823 F.3d 51 (2d Cir. 2016), recently adopted that very standard, so there was no need to grant rehearing on this issue.

SPD argued that Apotex couldn’t be reconciled with the opinion here, but the panel found that any “tension” was “only a tension of emphasis, not content.”  First, while Apotex said that “representations commensurate with information in an FDA label generally” (emphasis added) wouldn’t be actionable under the Lanham Act, it went on to acknowledge (in a footnote) that “Lanham Act liability might arise if an advertisement us[ing] information contained in an FDA-approved label... [is] literally or implicitly false.” Such was the case here.

Second, this case involved a different question of law.  Apotex presumed that the court could consider the claim, and the issue was “whether aspects of the defendant’s advertising incorporating FDA-approved factual assertions about pharmacological effects of its product were nonetheless false.”  But here, SPD was arguing that the court couldn’t even entertain a claim of falsity relating to FDA-approved messaging, without consideration of whether the advertising or labeling was in fact misleading, and that argument was rejected by Pom Wonderful.  [This distinction makes my head hurt, especially as to whether it can be distinguished from the first reason given by the court.]

Third, “the Lanham Act claims in the two cases relate to significantly different aspects of the FDA’s competence.”  And here we have one of my main questions/concerns about Pom Wonderful coming to the fore, perhaps unsurprisingly in the Second Circuit that also decided Caronia.  “The inquiry here does not relate to the truth or falsity of an FDA-approved factual assertion about the effects of a medical product, but rather to the question of whether the phrasing of advertising messages might be misunderstood by consumers.”  Apotex involved whether “a fact about the pharmacological effects of a drug, which the FDA had determined to be true, should nonetheless be found by the court to be false.”  The FDA’s job is to figure that out, and the court wouldn’t second-guess it “on matters as to which its competence vastly exceeds that of courts.”  Misleadingness was another matter. 

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