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Off-Label Promotion Ruling Not a Free Pass for Pharma

By Robyn Hagan Cain on February 07, 2013 | Last updated on March 21, 2019

In December, a Second Circuit Court of Appeals decision on off-label use promotions made life less complicated for pharmaceutical sales reps in New York, Vermont, and Connecticut. The appellate court ruled that a drug manufacturer's off-label use promotions are protected free speech, as long as such promotions are not false or misleading.

The 2-1 majority reasoned, "In the fields of medicine and public health, where information can save lives, it only furthers the public interest to ensure that decisions about the use of prescription drugs, including off-label usage, are intelligent and well-informed."

In this case, New York-based pharmaceutical rep Alfred Caronia was convicted under the FDCA for conspiracy to introduce a misbranded drug into interstate commerce. He was sentenced to one year of probation, plus 100 hours of community service, for improperly promoting a narcolepsy drug for "off-label" uses. The appellate court vacated his conviction on First Amendment grounds.

The "protected free speech" element is important because, under the Federal Drug and Cosmetic Act (FDCA), pharmaceutical manufacturers and their representatives could face misdemeanor charges for misbranding or felony charges for fraudulent misbranding if a drug's labeling fails to bear "adequate directions" for the promoted use.

While this decision may make life easier for pharmaceutical reps within the Second Circuit's tri-state reach, it doesn't mean that all pharmaceutical reps are free to promote off-label uses with doctors.

There's good news and bad news for corporate counsel following the appellate court's decision.

First, the good news: The Supreme Court ruled in Sorrell v. IMS Health Inc. that pharmaceutical marketing is protect free speech, so the Second Circuit's ruling isn't completely out of left field. Also, the Food and Drug Administration (FDA) announced last month that it will not appeal the Second Circuit's decision. For now, at least, off-label promotion won't be prosecuted in the Second Circuit feeder states.

The bad news? Reps have not been given carte blanche for off-label promotion in the remaining 47 states. And there could soon be a circuit split.

Only days after the Caronia decision came out, the Ninth Circuit heard another First Amendment challenge to an off-label marketing conviction. And the Ninth Circuit challenge involves allegations of false statements, which could make it a more appealing option for Supreme Court review from the Justice Department's perspective, Thomson Reuters News & Insight reports.

If you're drafting company policies for pharmaceutical sales reps -- especially outside of the Second Circuit's jurisdiction -- you need to tread carefully. Alfred Caronia's appellate victory won't protect everyone.

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