Date: Jun 27, 2011
On Thursday, June 23, 2011, the U.S. Supreme Court issued a decision in Pliva v. Mensing, holding that state-law claims against generic drug manufacturers are federally preempted where it is impossible for a generic drug manufacturer to comply with both state and federal labeling laws. The 5-4 opinion (delivered by Justice Clarence Thomas and joined in full by Chief Justice Roberts and Justices Scalia and Alito, and as to all except Part III-B-2 by Justice Kennedy) is a huge victory for generic drug manufacturers. The issue, as framed by the Court was "whether federal drug regulations applicable to generic drug manufacturers directly conflict with, and thus pre-empt, these state-law claims." According to the Court, they do.
The plaintiffs in the consolidated cases, Mensing and Demahy, were prescribed Reglan - the brand name of the drug metoclopramide - used to treat digestive tract problems. Both were given the generic version of the drug from their pharmacists. After taking the drug as prescribed, both women developed tardive dyskinesia, a severe neurological disorder allegedly known to be caused by long-term use of the drug. Respondents sued the generic drug manufacturers ("Manufacturers"), arguing that the Manufacturers were liable under Minnesota and Louisiana state tort laws for failing to provide adequate warning labels about the risks associated with long term use of metoclopramide. Specifically, they alleged that "despite mounting evidence that long term metoclopramide use carries a risk of tardive dyskinesia far greater than that indicated on the label," none of the Manufacturers had changed their labels to adequately warn of the dangers.
The Manufacturers defended both suits by urging that federal law pre-empted the state tort claims. Specifically, they claimed that federal statutes and FDA regulations required them to use the same safety and efficacy labeling as their brand-name counterparts. For that reason, it was impossible to simultaneously comply with both federal law and any state laws that required them to use different labels. The Fifth and Eighth Circuit Court of Appeals sided with Mensing and Demahy, rejecting the Manufacturers' preemption arguments.
The U.S. Supreme Court reversed. The Court first noted that Minnesota and Louisiana tort laws require a drug manufacturer that is or should be aware of its product's danger to label that product in a way that renders it reasonably safe. Mensing and Demahy argued that the Manufacturers were or should have been aware of the high risk of tardive dyskinesia and that they knew or should have known that their labels did not adequately warn of that risk.
The Court also noted that federal law imposes "far more complex drug labeling requirements," and under the Hatch-Waxman Amendments of 1984, differentiates between the duties owed by the brand-name manufacturers and those owed by manufacturers of generic drugs. A brand-name manufacturer seeking new drug approval is responsible for the accuracy and adequacy of its label, whereas a manufacturer seeking generic drug approval is responsible for ensuring that its warning label is the same as the label of the brand name drug.
Mensing and Demahy argued that generic manufacturers could have changed their labels after initial FDA approval. According to respondents, they could have done so through the FDA's "changes-being-effected" (CBE) process, which allowed the Manufacturers to change their labels when necessary. The FDA, however, denied that the Manufacturers could have used the CBE process to strengthen their warning labels. Instead, the CBE process could be used to change a generic drug label only in order to make it consistent with an updated brand-name label, or at the FDA's specific instruction. The FDA claimed that allowing CBE changes in other contexts would violate the statutes and regulations requiring a generic drug's label to match the label of its brand-name counterpart.
Respondents also argued that the Manufacturers could have used "Dear Doctor" letters to warn prescribing physicians and other healthcare professionals. Again, the FDA disagreed - Dear Doctor letters qualify as "labeling," and must be "consistent with and not contrary to [the drug's] approved … labeling." The Supreme Court deferred to the agency's views on both points. The FDA, however, claimed that the Manufacturers could have and were required to propose stronger warning labels to the FDA if they believed such warnings were needed. If the FDA agreed that label change was necessary, they would have worked with the brand-name manufacturers to create a new label for both, the brand-name and the generic drug. The Manufacturers and the FDA disagreed over whether the duty to request a strengthened label actually existed.
Turning to the issue of preemption, and citing its earlier decision, Wyeth, v. Levine, 555 U.S. 555, 567 (2009), the Court noted that where a state and federal law "directly conflict," state law must give way. Such conflict exists where it is "impossible for a private party to comply with both state and federal requirements." Freightliner Corp. v. Myrick, 514 U.S. 280, 287 (1995). The Court found such impossibility here: on the one hand, had the Manufacturers changed their labels to satisfy their state-law duty, they would have violated federal law; on the other hand, "even had [they] fulfilled their federal duty to ask for FDA assistance, they would not have satisfied the requirements of state law." Thus, the Court held, it was impossible for Manufacturers to comply with both state and federal laws.
The U.S. Supreme Court noted that whether a private party can act sufficiently independent under federal law to do what state law requires of it, is sometimes difficult to determine. This was not such a case because "before the Manufacturers could satisfy state law, the FDA … had to undertake special effort permitting them to do so." Thus, the Court held, "when a party cannot satisfy its state duties without the Federal Government's special permission and assistance, which is dependent on the exercise of judgment by a federal agency, that party cannot independently satisfy those state duties for preemption purposes."
The Court recognized that from the perspective of Mensing and Demahy, finding pre-emption here but not in Wyeth makes little sense – had Mensing and Demahy taken Reglan and not its generic equivalent, Wyeth would control and their lawsuits would not be pre-empted. But because their pharmacists substituted Reglan with its generic versions, Mensing, Demahy, and many others similarly situated throughout the country are barred from bringing similar lawsuits against generic manufacturers. The Court's decision draws a crucial distinction between generic and brand-name drugs.
Joined by Justices Ginsburg, Breyer, and Kagan, and claiming "absurd consequences" of the majority opinion, Justice Sotomayor wrote the dissenting opinion. The dissenting opinion claims that "[t]o reach the conclusion that the Manufacturers have  satisfied their burden to show impossibility, the majority invents a new preemption rule: ‘The question for "impossibility" is whether the private party could independently do under federal law what state law requires of it.'" Sotomayor argued that the majority's new test is "a direct assault" on precedent. According to the dissent, the outcome of the majority opinion – that manufacturers of generic drugs are not responsible for updating their labels in light of new safety concerns – will make generic drugs a riskier proposition for consumers. Finally, because consumers of brand-name drugs will be able to sue for inadequate labels, whereas consumers of generics cannot, the "divergent liability rules threaten to reduce consumer demand for generics, at least among consumers who can afford brand-name drugs."
 Consolidated with Actavis Elizabeth, LLC v. Mensing, on certiorari to the same court, and Actavis, Inc. v. Demahy, on certiorari to the US Court of Appeals for the Fifth Circuit.
 In Wyeth, the Court held that plaintiff's lawsuit was not pre-empted because it was possible for Wyeth, a brand-name drug manufacturer, to comply with both state and federal law by unilaterally strengthening its warning.