THE FIRST AMENDMENT’S IMPACT ON FEDERAL REGULATION OF ADVERTISING AND PROMOTION

1. THE FIRST AMENDMENT’S IMPACT ON FEDERAL REGULATION OF ADVERTISING AND PROMOTION Michael A. Swit, Esq. Law Offices of Michael A. Swit 760-815-4762 mswit@fdacounsel.com

2. 1st AMENDMENT Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances. December 15, 1791

3. 185 YEARS LATER … • 1976 -- Virginia PharmacyBoard – U.S. Supreme Court recognizes that “commercial speech” enjoys 1st Amendment protection, but not to the same extent as “traditional” speech, such as involved in political discourse. • “Commercial Speech” – “expression related solely to the economic interests of the speaker and its audience.”

4. CENTRAL HUDSON TEST • 1980 – Central Hudson decision –established criteria for government regulation of commercial speech • Is the speech related to an unlawful activity or is it misleading?

5. CENTRAL HUDSON “TEST” … • If not, then to regulate, the government must: • Assert a substantial interest to be achieved by restricting commercial speech • Use a regulatory approach that is proportionate to that substantial interest • Design a speech restriction that carefully achieves the government’s goal; i.e., must: • Directly advance state interest involved; and • Be “narrowly drawn” – i.e., a more limited restriction on commercial speech must not be available

6. FDA & CONTROLS ON OFF-LABEL USE • 1993 – Washington Legal Foundation (“WLF”) petitions FDA to loosen restrictions on unapproved or unlabeled uses of approved drugs or devices. • Catalyst– FDA letters and calls to firms warning vs. unsolicited distribution of textbooks and peer-reviewed articles (“enduring materials”)

7. FDA & CONTROLS ON OFF-LABEL USE … • 1994– after FDA denies petition, WLF sues agency in U.S. Dist. Ct. in D.C. • Oct. 1996 – while lawsuit in discovery, FDA issues 2 guidances: • Reprints of Certain Published, Original Data • Industry-Funded Dissemination of Reference Texts • 61 Fed. Reg. 52800 (Oct. 8, 1996)

8. FDA & CONTROLS ON OFF-LABEL USE … • REPRINTS GUIDANCE -- 1996 • Article’s main subject had to be approved use • Peer reviewed journals only • Must relate to a study that was part of substantial evidence conclusion for NDA approval or as evidence of a device’s safety or effectiveness • Had to highlight any information in article that differed from the approved labeling

9. FDA & CONTROLS ON OFF-LABEL USE … • INDUSTRY FUNDED TEXTBOOKS GUIDANCE – 1996 • Text must not have been written, edited, etc. for or at request of a regulated firm, unless text is a “balanced presentation” via a process fostering input from a “relatively wide spectrum of sources” • Content not reviewed, edited or “significantly influenced” by regulated firm • Text must be generally available from channels other than regulated firm

10. FDA & CONTROLS ON OFF-LABEL USE … • INDUSTRY FUNDED TEXTBOOKS GUIDANCE – 1996 … • Text should not focus primarily on product of disseminating firm • No product info inserts of disseminating firm’s products • Firm can not refer or promote, in any manner or at any time, information in text on unapproved use of its product

11. FDA & CONTROLS ON OFF-LABEL USE … FDAMA § 401 • Enacted – November 21, 1997 – said to create a “Safe Harbor” For Off-Label Use • Supersedes 1996 Guidance on reprints & texts • Seen as being of very limited utility • How it works: • Recipients limited -- OK to disseminate to unapproved use info for an approved product to: • health care practitioner • pharmacy benefit manager • health insurance issuer • a group health plan, or • a Federal or State governmental agency;

12. FDAMA § 401 … • How it works … • Must be “authorized information” -- § 552 of Federal Food, Drug, and Cosmetic Act (“Act”) • Unabridged reprint/copy or a reference publication • “reference pub.” – similar to Oct. 1996 Guidance • Peer-reviewed • in a “scientific or medical journal” – §556(5) • About a clinical investigation on drug or device • “scientifically sound” • Not false or misleading • No “significant risk” to public health

13. FDAMA § 401 … • How it works … • Can’t be research on someone else’s product unless have their OK • 60 days pre-use notification to FDA • Copy of off-label information • “any clinical trial information” have on the product – i.e., beyond that in the proposed off-label info • Must have filed for supplemental approval for the off-label use – per §554

14. FDAMA § 401 … • How it works … • Include with info a prominent disclaimer: • Info concerns an unapproved/cleared use • If applicable, that info disseminated at mfr.’s expense • Names of any authors who are mfr.’s employees or consultants or who have received compensation from mfr. or have “significant financial interest” in mfr. • If applicable, that there are approved products for the use in question • I.D. of any person who provided funding for the article • Include with info a bibliography of other articles on that off-label use

15. FDAMA § 401 … • How it works … • FDA can conclude that the info fails to be “objective and balance” • Must give you notice and chance for a meeting • Can order you to disseminate additional “objective and scientifically sound” info or a summary of such and • “An objective statement” by FDA on the use

16. FDAMA § 401 … • How it works: • Must file information biannually with FDA on all off-label information disseminated in last 6 months & categories of providers • Continuing Duty to submit more data • Corrective Action – if FDA, based on post-dissemination data, concludes the new use is not effective or a significant risk to public health, can take appropriate action to protect public health

17. FDAMA § 401 … • How it works … • Cessation Order – possible in some circumstances: • Supplemental application lacks adequate information to approve new use • Don’t file supplement after promising to do so • FDA can order you to take corrective action relative to the disseminated off-label info

18. FDAMA § 401 … • Other Key Provisions • § 401 n/a to unsolicited requests from a health care practitioner • If you meet § 401, FDA can’t construe fact you disseminated off-label use info as evidence of a new intended use • Added 201(z) – violation of § 551 of Act (as created by FDAMA) = “prohibited act” • Sunset – November 20, 2005

19. 1998 REGULATIONS • November 20, 1998 – 63 Fed. Reg. 64556 • Created 21 CFR Part 99 • Provides more detail to § 401 language – particularly the information required in the 60-day pre-dissemination submission to FDA

20. FDA & CONTINUING MEDICAL EDUCATION (CME) • 1992 – Draft Guidance on Industry-Supported Scientific and Educational Activities (ISSEA) • December 3, 1997 – Final Guidance – 62 Fed. Reg. 64074: • “…programs and materials performed and disseminated by [or on behalf of] companies are subject to labeling and advertising provisions” of the Act

21. FDA & CME … • 1997 Guidance … • “truly independent and non-promotional industry-supported activities have not been subject to FDA regulation.2” • Footnote 2 – independence is an indication of nonpromotional nature • Unapproved uses – not permissible in programs subject to substantive influence by companies that market product related to the program subject

22. FDA & CME … • The 1997 Guidance … • Looking at direct and indirect influence • Statement of FDA enforcement policy • Activities subject – relate to company’s products or competitive products • “Independence factors” • Control of content and selection of presenters and moderators

23. FDA & CME … • The 1997 Guidance … • “Independence factors” … • Disclosures – meaningful to audience at time of program, on: • Company funding of program • Significant relationships between educational provider, presenter or moderator and company, like: • Employees • Grant recipients • Stock ownership • Whether any unapproved uses will be discussed

24. FDA & CME … • The 1997 Guidance … • “Independence factors” … • Program Focus • Does program title fairly reflect scope of program • Is central theme based on single product or competing product? [i.e., does it limit discussion of alternative therapies?] • Relationship Between Education Provider & Co. • Example – does the provider depend on company for its viability

25. FDA & CME … • The 1997 Guidance … • “Independence factors” … • Provider involvement in Sales or Marketing of company product • Provider’s Demonstrated Failure to Meet Standards • Multiple Presentations of Same Program • Audience Selection – does it reflect “sales or marketing goals” – e.g., high prescribers

26. FDA & CME … • The 1997 Guidance … • “Independence factors” … • Opportunities for Discussion • Dissemination – further by company after program • Ancillary Promotional Activities – are sales guys in meeting room? • Complaints – on company attempts to influence • “Additional Considerations”

27. FDA & CME … • The 1997 Guidance … • “Additional Considerations” • Written agreement between company & provider spelling out independence • Not required, “can provide valuable evidence” of independence • Post-Guidance Regulatory Action – none

28. THE WASHINGTON LEGAL FOUNDATION CASES • Lawsuit -- filed in 1994 – aimed at off-label dissemination of reprints/copies & texts and CME • WLF I -- July 30, 1998 – District Court Decision –granting WLF summary judgment • Rejected WLF claim that speech here was “scientific and academic” – highest form; ruled = “commercial speech”

29. WLF Cases … • WLF I -- FDA – tried to assert it was regulating conduct, not speech, and as part of a pervasive statutory scheme to regulate drugs – Court rejected – still have to consider 1st Amendment • FDA – an unapproved use means product is illegal, thus not entitled to 1st Amendment protection under Central Hudson test • Court – the speech must be about illegal conduct – here, the conduct would be the doctor’s off-label prescribing – which is legal.

30. WLF Cases … • WLF I -- Court – FDA had a substantial interest in getting companies to pursue approval of off-label uses, but the guidances went too far in seeking that goal – less burdensome speech restrictions existed: • full disclosure

31. WLF Cases … • WLF I -- FDA’s regulatory efforts can’t be paternalistic – i.e., assume reader will use unwisely • WLF I -- 1998 Summary Judgment Order • FDA may require conspicuous disclaimers • FDA may require reprints be from “bona fide peer review journals” • FDA may require textbooks be from “bona fide independent publisher”

32. WLF Cases … • WLF I -- 1998 Summary Judgment Order … • FDA may require CME sponsors be an accredited “independent program provider” • FDA may not restrict co. from suggesting speakers to an independent provider even if unapproved uses are discussed • WLF II -- 1999 Motion – does July 1998 order apply to FDAMA § 401 and 11/98 regs?

33. WLF Cases … • WLF II -- 1999 Motion … • Yes – while 3 guidances involved, the underlying policies are subject to decision • But, requested briefing on impact on FDAMA (even though Ct. recognized that FDAMA “largely perpetuated” the guidances); so decision then limited to the guidances

34. WLF Cases … • WLF III – July 1999 – on full briefing, District Ct. held FDAMA and implementing regulations & the 3 guidances violated 1st Amendment; entered permanent injunction • Called FDAMA requirement to file a supplement “constitutional blackmail” • Order – related to dissemination to physicians or other medical professionals

35. WLF Cases … • WLF IV -- Feb. 2000 Decision – U.S. Ct. of Appeals • FDA – conceded FDAMA did not give it independent authority to proscribe speech; • merely created a “safe harbor” under which dissemination consistent with FDAMA could not be used to show intent • WLF – said, if FDA says it’s just a safe harbor and does not authorize limits on speech, then we have no constitutional question here • Court – thus, no controversy; and FDA can’t change its mind later without a “reasoned explanation” • Vacated District Court decision

36. WLF Cases … • March 16, 2000 – FDA notice on WLF Cases – 65 Fed. Reg. 14286 • reiterated that FDAMA = “safe harbor” • If you don’t follow the rules for a safe harbor, you expose yourself to enforcement action • Indicate how FDA will exercise enforcement discretion • Still leaves open question of constitutionality of dissemination outside the harbor that leads to FDA action !!! • WLF V – Nov. 2000 • WLF moved to confirm and enforce the 1999 permanent injunction • Court – the Court of Appeals decision vacates the entire injunction as it rested solely on constitutional grounds

37. WLF Cases … • Net result – this order “will do little to resolve the issue that lies at the heart of the dispute: whether the FDA violates the First Amendment by penalizing drug manufacturers for sending scientific literature to physicians regarding off-label uses.”

38. WLF – Where today? • May 2001 – WLF petitions FDA to withdraw the March 2000 F.R. notice, cites FDA regulatory action on reprints: • New Star Lasers, Inc. for reprints saying “Wrinkle Treatment Indication Pending FDA Clearance”

39. WLF – Where Today? • January 2002 – FDA Reply to WLF C.P. • FDA will ensure its personnel understand there is no independent bar on off-label dissemination or CME • Reiterated FDAMA safe harbor and that CME Guidance = safe harbor • But, stressed that the act of disseminating off-label could be used to infer intent to distribute an unapproved new drug • FDA – unlikely to rely solely on dissemination of unapproved uses to support enforcement – • dismissed New Star enforcement action as an issue because other indicia of intent were present • WLF – FDA’s position “chills speech”, but have to wait for enforcement action to raise 1St Amendment issue again

40. WESTERN STATES MEDICAL • FDAMA §127 – created § 503A – “safe harbor” for compounding pharmacies from violating new drug laws by manufacturing (as opposed to compounding) – but linked to restrictions on promotion and advertising of the compounded products -- • Challenged by several compounding pharmacies

41. WESTERN STATES MEDICAL … • Supreme Court – ruled the restrictions on promotion and advertising violated 1st Amendment; stressed that, in accomplishing its statutory duties, FDA (and Congress in enacting FDAMA) must regulate speech as a last resort

42. THE FUTURE OF FDA & 1ST AMENDMENT? • May 2002 – FDA issues a Federal Register notice seeking comment on how it should conduct its activities in the light of 1st Amendment concerns; • 100’s of comments filed • Effort – still pending • No legal challenges raised either (to my knowledge) • Stay tuned …

43. The End

44. Questions? Michael A. Swit Attorney at Law Law Offices of Michael A. Swit 539 Samuel Ct. , Suite 229 ♦ Encinitas, CA 92024 Office: 760-815-4762 ♦ O-Fax: 760-454-2979 mswit@fdacounsel.com Also Admitted In Virginia and D.C..

45. About your speaker Michael A. Swit has over 19 years of experience addressing critical FDA legal and regulatory issues. His vast and varied experience, which he is now providing as a solo practitioner, includes serving for three and a half years as vice president and general counsel of Pharmaceutical Resources, Inc. (PRI) a prominent generic drug company and, thus, brings an industry and commercial perspective to his representation of FDA-regulated companies. While at PRI from 1990 to late 1993, Mr. Swit spearheaded the company’s defense of multiple grand jury investigations, other federal and state proceedings, and securities litigation stemming from the acts of prior management. Mr. Swit then served from 1994 to 1998 as CEO of Washington Business Information, Inc. (WBII) a premier publisher of FDA regulatory newsletters and other specialty information products for the FDA-regulated community. From May 2001 to to May 2002, Mr. Swit was special counsel in the FDA Law Practice Group in the San Diego office of Heller Ehrman White & McAuliffe. Before that, he was twice in private practice with McKenna & Cuneo, from 1988 to 1990 and, most recently, from 1999 to 2001, first in that firm’s D.C. office and most recently, in its San Diego office. He first practiced FDA regulatory law with the D.C. office of Burditt & Radzius from 1984 to 1988. Mr. Swit has taught and written on a wide variety of subjects relating to FDA law including, since 1989, co-directing a three-day intensive course on the generic drug approval process and editing a guide to the generic drug approval process, Getting Your Generic Drug Approved. He is a member of the California, Virginia and District of Columbia bars.