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December 2012

Federal Appeals Court Strikes Down Criminal Conviction for Off-Label Drug Promotion

In United States v. Caronia, 2012 U.S. App. LEXIS 24831 (2d Cir. Dec. 3, 2012), the U.S. Court of Appeals for the 2nd Circuit held it was a violation of First Amendment free-speech rights for the government to prosecute a pharmaceutical company employee for off-label promotion of a prescription drug. Specifically, the majority held that “the government cannot prosecute pharmaceutical manufacturers and their representatives under the [Federal Food, Drug, and Cosmetic Act] for speech promoting the lawful, off-label use of an FDA-approved drug.” 

A federal jury in New York had found drug sales representative Alfred Caronia guilty of conspiracy to introduce a misbranded drug into interstate commerce. He had been recorded promoting off-label (non-FDA approved) use of Xyrem, a drug for treating narcolepsy, and the government prosecuted him for those statements. Caronia appealed, contending he was convicted in violation of his First Amendment right to freedom of speech.

The question the 2nd Circuit considered on appeal was “whether the government’s prosecution of Caronia under the [Federal Food, Drug, and Cosmetic Act] … for promoting an FDA-approved drug for off-label use was constitutionally permissible.” The court determined that the FDA’s regulation restricting speech is content- and speaker-based, and therefore subject to heightened scrutiny. The court also determined that the regulation failed to advance the government’s interests in reducing patient exposure to unsafe and ineffective drugs and encouraging manufacturers to seek approval for new uses of approved drugs. The court noted that the regulation was not narrowly drawn, suggesting several less speech-restrictive alternatives to a complete ban on off-label promotion.

The 2nd Circuit vacated Caronia’s conviction, with one dissent.

Caronia is a significant decision that may pave the way for drug companies to expand how they market products. However, because this decision applies in the 2nd Circuit only, for now national drug companies are unlikely to change their marketing practices. The decision also stands to curtail the government’s ability to leverage large settlements against drug companies for off-label promotion under the False Claims Act, such as GlaxoSmithKline’s $3 billion payment in July.

It is likely the government will request an en banc rehearing and Caronia will find its way to the U.S. Supreme Court. Meanwhile, the Food and Drug Administration may be reluctant to pursue similar cases until the legal issues are resolved.

Leslie A. Benitez