Marketing pharmaceutical products in the twenty-first century: an analysis of the continued viability of traditional principles of law in the age of direct-to-consumer advertising.

• Author: Schwartz, Victor E.

INTRODUCTION I. MARKETING AND REGULATION OF PHARMACEUTICALS FROM PAST TO PRESENT A. Concepts of Product Mislabeling and Pre-Market Regulation B. Establishment of the Modern Regulatory Regime for Approval and Marketing of Prescription Drugs C. DTC Advertising and Its Regulation Today D. The Relevance of History to DTC Advertising Today II. THE POTENTIAL BENEFITS AND PITFALLS OF DTC ADVERTISING III. TRADITIONAL RULES OF LAW REMAIN VIABLE, SOUND PUBLIC POLICY TODAY A. Ask Your Doctor: The Learned Intermediary Doctrine 1. Learned Intermediary Fundamentals 2. Traditional Limited Exceptions to the Rule 3. A Few Recent Decisions Chip Away at the Learned Intermediary Rule 4. Exceptions for DTC Marketing Represent Unsound Policy B. Effect of Compliance with FDA Requirements on Liability 1. Common Law Principles 2. Statutory Consideration of the Effect of Regulatory Compliance on Liability a. Presumption of Nondefectiveness b. Preclusion of Punitive Damages for FDA-Approved Pharmaceuticals c. Placing Regulated Conduct Beyond the Scope of Consumer Protection Laws C. Conflicts with Federal Authority: Preemption 1. Methods of Preemption 2. The FDA's Changing Priorities in a DTC Environment 3. Public Policy Supports Expanding Scope of Preemption CONCLUSION INTRODUCTION

According to a recent article in the New England Journal of Medicine, total pharmaceutical industry spending on direct-to-consumer (DTC) advertising of prescription drugs rose from $985 million in 1996 to $4.2 billion in 2005--an increase of 330%. (1) As a result, advertisements for prescription drugs are pervasive and consumers regularly view them in magazines and online, watch them on television, and listen to them on the radio.

This figure, however, must be put in perspective. Research also shows that during the same period, spending on pharmaceutical marketing increased not only for DTC advertising, but also across the board, from about $11.4 billion to $29.9 billion. (2) In fact, although DTC advertising has increased steadily both in absolute terms and as a percentage of pharmaceutical sales, promotion of drug treatments directly to physicians and other health care professionals still far outweighs DTC advertising. (3) In 2005, $7.2 billion was spent on promotion to physicians alone. (4) Relatively speaking, DTC advertising is concentrated on a small number of brands. (5) Its reach, however, is considerable, and DTC advertising is the subject of significant debate among courts and commentators. (6)

In light of these changes in the marketing environment, this Article examines whether traditional legal principles governing the duty to warn of the risks of pharmaceutical products remain sound public policy. First, the Article considers the early history of the sale and marketing of pharmaceutical products, discussing the initial tragic absence of regulation, followed by the establishment of the FDA and the pre-market approval process. It then examines the modern age of pharmaceutical advertising, including the FDA's relatively recent guidance on DTC broadcast advertising and the extent of its regulation. Finally, the Article examines rules of law that establish the legal landscape for warnings and advertising in the pharmaceutical context. This includes the learned intermediary doctrine, the effect of regulatory compliance on product liability and consumer protection claims, and the application of conflict preemption principles to tort law claims involving FDA-approved products.

The Article finds that the two foundational tenets underlying these doctrines have not changed. First, on a societal level, the FDA continues to regulate the pharmaceutical industry closely, both in approving pharmaceutical products as safe and effective for certain classes of patients and in mandating disclosure of risks so that physicians can accurately counsel their patients. Second, physicians remain individually responsible for diagnosing each patient regardless of advertising and for helping each patient make an educated treatment decision in light of the risks and benefits of a drug. Because of their authority to write prescriptions, physicians have ultimate responsibility for deciding whether a given drug is appropriate and beneficial for the patient. Prescription drug manufacturers, therefore, have obligations to report all material information to the FDA, both before and after approval, so that the FDA can make a fully informed decision about what products should be available to the market and can convey adequate information to physicians for patient counseling purposes.

The Article concludes that, irrespective of the rise of DTC advertising, traditional principles of law fully retain their viability in the post-DTC world both as a matter of jurisprudence and sound public policy.

1. MARKETING AND REGULATION OF PHARMACEUTICALS FROM PAST TO PRESENT

   1. Concepts of Product Mislabeling and Pre-Market Regulation

      Before examining modern regulation of pharmaceutical products and their advertising, placing the current system in historical context is useful. Companies that sell medications have advertised their products directly to consumers since the beginning of medicine. The increasing regulatory scrutiny regarding approval, marketing, and sale of prescription drugs, however, is a relatively recent development. The new oversight is meant to ensure that drugs are safe and effective and that drug advertising does not mislead the public.

      During much of the eighteenth and nineteenth centuries, companies regularly advertised patent medicines, which were available without a prescription, directly to consumers in American newspapers. Indeed, during the 1800s, patent medicine advertisers spent more on newspaper advertisements than any other group. (7) At the time, no regulatory structure existed to provide for pre-market review of these medicines to ensure their safety or efficacy or to substantiate the claims their producers made in these advertisements. The grifting snake oil salesman, a character that still pervades the mythology of the American West, dates to this unregulated period.

      In 1906, Upton Sinclair published his novel, The Jungle, with its detailed account of the unsanitary conditions of the Chicago stockyards. (8) Prompted by the resulting public outcry from the book and public reaction to similar disclosures in the nation's newspapers about poisonous preservatives and dyes in foods and cure-all patent medicines, Congress passed the original Pure Food and Drugs Act. (9)

      But if the 1906 Act was meant to curb the deceptive practices of snake oil salesmen, it was poorly equipped for the task. First, the 1906 Act did not prevent manufacturers from placing worthless medicines on the market because proof of safety or efficacy was not required. Second, the Act was directed only at product labels, not extra-label advertising. (10) It defined a drug as "misbranded" only if the stated claims on the label regarding its curative or therapeutic qualities were proven false or fraudulent. (11)

      These inadequacies became tragically apparent some three decades later. In June 1937, a salesman for the S.E. Massengill Co. reported that his customers sought a liquid version of the drug sulfanilamide, which had been used to treat streptococcal infections and had been proven to have dramatic curative effects in tablet or powder form. (12) Responding to the market need, a chemist and pharmacist for the company experimented with sulfanilamide's solubility and found that it would dissolve in diethylene glycol. (13) Although the company tested the product for flavor, appearance, and fragrance, it did not test the product's toxicity. (14) In sufficient doses, diethylene glycol is toxic to humans and animals, causing renal failure, encephalopathy, and death. (15) A scientific literature review or a few simple animal tests would have revealed its lethal properties. (16) S.E. Massengill, however, shipped the product without taking these precautions. Between September and October 1937, more than one hundred people across the country obtained the product from their doctors or bought it from a pharmacy and died after consuming it. (17) After news of the strange deaths began surfacing, the FDA investigated and intervened, seizing shipments from pharmacies and doctor's offices across the country. But the FDA's sole authority for these seizures was not--as one might expect--that the drug was manufactured and sold without any pre-market toxicity review. Ironically, the FDA only had authority to intervene through the 1906 Act's prohibition against label misbranding. (18) The term "elixir" on the product's label implied that the product was an alcohol solution when, in fact, it contained no alcohol. (19) Had the product instead been labeled a "solution," the FDA would have had no authority under the 1906 Act to intervene. (20)

      In response to the crisis, Congress repealed the 1906 Act and replaced it with the Federal Food, Drug, and Cosmetic Act of 1938 (FDCA). (21) The increased protections of the new act included an FDA pre-market notification (but not approval) requirement for all "new drugs." (22) In order to market a new drug, a manufacturer would submit a New Drug Application (NDA) to the FDA. If the FDA did not affirmatively deny the application within sixty days, then the manufacturer could market the drug immediately. (23) Unsurprisingly, given the Elixir Sulfanilamide incident, this pre-market notification system focused solely on proof of the new product's safety, not its efficacy. (24) Thus, the FDA retained jurisdiction over the product label and it obtained authority under the 1938 Act to conduct a pre-market safety review.

      In the same year Congress expressly vested jurisdiction over all drug advertisements with the Federal Trade Commission (FTC). (25) Congress had created the FTC in 1914 with the passage of the Federal Trade Commission Act. (26) Under that Act, Congress authorized the...