Another pharma substitution case fails

Sebela Pharmaceuticals Inc. v. TruPharma, LLC, 2021 WL 4316750, No. 1:20-cv-1677-SB (D. Del. Sept. 8, 2021)

When a false advertising case starts this way, you can guess how it will end: “Market competition is good. Competitors are free to copy successful products as long as they do not steal, lie, or mislead.” Here, Sebela didn’t plausibly allege anything false or deceptive in its rival’s sale of a medical cream with the same active ingredients in the same strength. A pharma database links the two as equivalent, which allegedly caused substitution of TruPharma’s cream for Sebela’s cream. But Sebela didn’t point to any TruPharma statement as false. TruPharma’s cream is not an FDA-approved generic and has not been tested for bioequivalence, but Sebela never alleged that it claimed that its creams “are AB-rated, therapeutically equivalent, bioequivalent, and/or FDA-approved generics to [Sebela’s cream].”

The closest it came to alleging misleadingness was is a screen shot of a database that lists Sebela’s cream as an “Equivalent Drug” for TruPharma’s. “But TruPharma’s cream is indeed ‘pharmaceutically equivalent’: as Sebela admits, it has the ‘exact same strength and active ingredients’ in the same form.” Though Sebela argued that “equivalent” implied bioequivalence and FDA approval, “Sebela gives no reason to think that pharmacists are confused, let alone misled.” [This might be a survey problem: some plaintiffs have done better with survey evidence.]

Sebela alleged substitution, but “substitution does not imply deception. As Sebela’s own complaint shows, pharmacists substitute drugs based on cost,” and TruPharma’s cream was cheaper. Sebela even pled that insurers and pharmacy-benefit managers often “decide to only cover a cheaper drug that is pharmaceutically equivalent, even where there has been no showing of therapeutic equivalence.” Id. And Sebela admitted that “substitution will also occur even if a Drug Database states that TruPharma’s [cream] is not an A- or AB-Rated generic” approved by the FDA.

Confusion was possible, but that wasn’t enough under Twiqbal. “I find it implausible that trained, licensed pharmacists are fooled. Far more likely, they are just heeding frugal patients, insurers, and pharmacy-benefits managers.”

Moreover, even if Sebela plausibly alleged misleading statements, it didn’t plausibly allege that TruPharma (rather than the database operators) made them.