Second Circuit Court of Appeals rules on Caronia

First Amendment protects free speech even when promoting misbranded, off-label drug use

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NEW YORK—In a controversial anddivided ruling, the Second Circuit Court of Appeals on Dec. 3 vacatedthe judgment of the U.S. Court for the Eastern District of New Yorkthat convicted pharmaceutical sales representative Alfred Caronia ofconspiracy to introduce a misbranded drug into interstate commerce inviolation of the Federal Drug and Cosmetic Act (FDCA).

The panel of three appellate judgesheld 2-1 that the district court's 2009 conviction violatedCaronia's First Amendment right of free speech, despite courtroomevidence demonstrating that Caronia exaggerated—and evenmisrepresented—the uses for Xyrem, a potent drug prescribedprimarily for narcolepsy.

While the court recognized that theU.S. Food and Drug Administration (FDA) must first approve a drug fora particular use before it can be distributed into interstatecommerce, once approved, a physician is generally permitted toprescribe the drug for any use deemed appropriate in his or hermedical judgment. The use of a drug for a purpose not approved by theFDA is referred to as "off-label use," and is not necessarilyillegal.

The FDA has also taken the positionthat drug manufacturers and their representatives—unlikephysicians—may not promote off-label uses of a drug. According tothe FDA, such promotion constitutes criminal "misbranding" inviolation of the FDCA. Specifically, the FDA contends that thepromotion of off-label use is "misbranding" because the labelingof a drug never has adequate directions for the drug's off-labeluse, according to the court.

The case unfolded in 2005 when Caronia,as a sales rep, promoted the drug Xyrem for drug manufacturer OrphanMedical Inc., which is now known as Jazz Pharmaceutical. Jazzgrossed $20 million in combined Xyrem sales in 2005, according tocourt records.
Xyrem is a powerful central nervoussystem depressant approved by the FDA to treat narcolepsy patientswho experience cataplexy or excessive daytime sleepiness. Xyrem cancause serious side effects, including difficulty breathing whileasleep, confusion, abnormal thinking, depression, nausea, vomiting,dizziness, headache, bedwetting and sleepwalking. If abused, Xyremcan cause additional medical problems, including seizures,dependence, severe withdrawal, coma and death. In fact, the FDArequires that the drug be accompanied by a "black box" warning,which indicates that the drug's safety has not been established inpatients under the age of 16.

When the federal government beganinvestigating Orphan for off-label promotion of Xyrem, its uncoveredevidence that Caronia and "Dr. Gleason," a physician hired byOrphan to promote Xyrem, were promoting the drug for unapproved uses.Caronia was recorded telling a government informer that Xyrem couldbe used to treat fibromyalgia, chronic fatigue or chronic pain, andthat it also could be used by patients under the age of 16.

The case was tried before a jury inOctober 2008. The record makes clear that the government prosecutedCaronia for his off-label promotion, in violation of the FDCA. OnNov. 30, 2009, the district court sentenced Caronia to one year ofprobation, 100 hours of community service and a $25 specialassessment.

On appeal, Caronia argued that themisbranding provisions of the FDCA prohibit off-label promotion, andtherefore unconstitutionally restrict speech. Caronia also arguedthat the First Amendment does not permit the government to prohibitand criminalize a pharmaceutical manufacturer's truthful andnon-misleading promotion of an FDA-approved drug to physicians foroff-label use—where such use is not itself illegal and others arepermitted to engage in such speech.

"Caronia argues that he was convictedfor his speech—for promoting an FDA-approved drug for off-labeluse—in violation of his right of free speech under the FirstAmendment," Second Circuit Judge Dennis Chin wrote for themajority. "We agree. Accordingly, we vacate the judgment ofconviction and remand the case to the district court."

The court explained that it was clearfrom the government's arguments at trial that Caronia was, in fact,prosecuted for his speech, and his speech did not merely play anevidentiary role in determining whether the drug was misbranded.

Next, the court turned to whether thecriminalization of pharmaceutical manufacturers' speech promotingoff-label use violates the First Amendment.

"The government cannot prosecutepharmaceutical manufacturers and their representatives under the FDCAfor speech promoting the lawful, off-label use of a FDA-approveddrug," Chin stated. "The proscribed conduct for which Caronia wasprosecuted was precisely his speech in aid of pharmaceuticalmarketing."

Writing the lone dissenting opinion,Judge Debra Ann Livingston stated the decision might restrictprosecutors from successfully trying future drug cases.

"The majority calls into question thevery foundations of our century-old system of drug regulation,"Livingston wrote.

The Second Circuit Court's decisionappears to have undermined the district court's prosecution ofthose who engage in false or misleading marketing instead of focusingon those who share truthful information about off-label use. In"Off-Label Marketing and the First Amendment," the New EnglandJournal of Medicine weighed in on the issue, stating: "On Dec.3, 2012, a three-judge panel of a U.S. appeals court took acontroversial leap toward what some fear will be license by thecourts to invalidate a host of state and federal regulations,including some applicable to healthcare. At issue in the Dec. 3opinion—which is doubtless headed for further appeal—were the FDAregulations applicable to marketing of prescription pharmaceuticalsfor off-label uses."

Whether Caronia winds its way to theU.S. Supreme Court "is yet to be determined," said Jacqueline R.Berman, an attorney in the FDA & Healthcare Practice Group atMorgan, Lewis & Bockius LLP, writing in the March-April 2012Journal of Health Care Compliance.

"Even if (Caronia) is heard by theSupreme Court, a decision likely will not change the entire nature ofoff-label promotion," Berman wrote. "Rather, it is more likelythat the court will proceed incrementally, addressing discreteaspects of the government's off-label promotional policy. In thecoming years, however, these will be cases to watch closely, as theycould begin a course of events that impact how drugs are promoted inthe United States."


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