Thursday, October 25, 2007

FDA preemption goes to the dogs

Putney, Inc. v. Pfizer, Inc., 2007 WL 3047159 (D. Me.) (magistrate judge)

Pfizer, the defendant, moved for a preliminary injunction on its false advertising claims against Putney based on Putney’s advertising of its cefpodoxime proxetil medicine to vets and others as being FDA-approved for animal use.

Pfizer sells cefpodoxime proxetil as Simplicef, used to treat canine skin infections, originally FDA-approved for humans under the name Vantin; in 2004 this approval was extended to dogs, and Pfizer got exclusive rights to market it to vets until July 22, 2009. In 2007, Putney began selling cefpodoxime proxetil to vets. It obtains the drug from Ranbaxy, which has FDA approval to make and sell the drug for human use because Ranbaxy established bioequivalence to Vantin in humans. Ranbaxy packages the drug with Putney’s name and label, selling it at a substantially lower price than the human-directed version.

Pfizer alleged that Putney falsely told vets that Putney has FDA authorization for cefpodoxime proxetil for use in animals, that its product had been FDA-approved as bioequivalent and thus is a generic for Simplicef, and that the FDA had approved Putney’s product for use in animals. Putney’s marketing brochure begins “PUTNEY[:] YOUR PARTNER FOR HIGH QUALITY FDA APPROVED GENERICS.” It continues: “For the first time there is a brand that stands for high quality, FDA approved drugs that are equivalent to brand name drugs at competitive prices, exclusively for veterinarians. … We are focused on the development of high quality, true generics that are FDA approved and bioequivalent to brand drugs and important therapies where choice and competition are limited. Our goal is to launch generic versions of drugs veterinarians have requested to enable veterinarians to make prescribing decisions based on pet patient needs…. Putney sells only FDA approved products ….” The brochure also contains a chart touting the rigorous FDA NDA review process.

But to market the drug legally under the FDCA as generic Simplicef, Putney would have had to file an Abbreviated New Animal Drug Application, and this it has not done; nor could it successfully do so during Pfizer’s market exclusivity for Simplicef.

The magistrate judge rejected Putney’s FDA preemption claim, accepting Pfizer’s argument that the issue is whether Putney’s product has been approved for use in animals, not whether it should be, and only the latter type of claim is preempted. This is not quite the same as, though related to, the question of whether representations of FDA approval have to be explicit in order to be actionable under the Lanham Act, since past cases have also suggested that the mere expectation of consumers that drugs are FDA-approved is not enough to make advertising of unapproved drugs violate the Lanham Act. Here, however, the brochure’s claims about FDA approval are “reasonably clear” and there is no need to leave the matter to the FDA. Thus, the counterclaim successfully alleged an affirmative misrepresentation.

In a footnote, the magistrate judge expressed the same dissatisfaction I have with prior precedent, and suggested that the Lanham Act does not require “explicit assertion[s] of FDA approval for both the drug at issue and the use of that drug at issue,” because that limitation would “open a hole” in the Lanham Act to careful advertisers.

Putney argued that there was no advertisement or promotion at issue. It’s a drug company, it sells drug products to vets, and it has a business brocure that “describes its company.” But, it said, there’s no ad! The magistrate judge made justifiably short shrift of this argument – the brochure was a means through which Putney disseminated information to a class of consumers. It was significant that Pfizer alleged that, at the relevant time, Putney had only one product on the market. (Though I think this argument should be laughed at regardless.)

The magistrate judge also rejected Putney’s contention that Lanham Act claims should be subject to a heightened pleading standard.

Putney did succeed in having the state-law consumer protection claims dismissed, since only consumers have standing.

And Putney ultimately avoided a recommended injunction because it had pulled the brochure from distribution and stated under oath that it wouldn’t use the brochure in the future (at least during Pfizer’s exclusivity period). Because the question of liability was a close one, Putney’s continued protestations of innocence did not lead the magistrate judge to conclude that Putney was likely to resume its offending conduct.

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