United States v. Generix Drug Corporation

• Decision Date: 22 March 1983
• Docket Number: No. 81-1222,81-1222
• Citation: 75 L.Ed.2d 198,460 U.S. 453,103 S.Ct. 1298
• Parties: UNITED STATES, Petitioner v. GENERIX DRUG CORPORATION et al
• Court: U.S. Supreme Court

460 U.S. 453

103 S.Ct. 1298

75 L.Ed.2d 198

UNITED STATES, Petitioner

v GENERIX DRUG CORPORATION et al.

No. 81-1222.

Argued Nov. 3, 1982.

Decided March 22, 1983.

Syllabus

The Federal Food, Drug and Cosmetic Act (Act) prohibits the marketing of a "new drug" without the prior approval of the Food and Drug Administration (FDA). Section 201(p) of the Act defines a "new drug" as "any drug . . . [which] is not generally recognized as safe and effective . . . or . . . which has not, otherwise than in [safety and effectiveness] investigations, been used to a material extent or for a material time." Section 201(g)(1) defines the term "drug" as, inter alia, "articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or in other animals." The Government brought an action in Federal District Court to enjoin respondent Generix Drug Corp. (respondent) from distributing a number of generic drug products containing specified active ingredients, alleging that the FDA had never approved "new drug" applications with respect to such products. Holding that a generic drug product containing the same active ingredients as a previously approved pioneer drug marketed under a brand name is a "new drug" if there is a reasonable possibility that the differences in inactive "excipients" between the generic product and the pioneer drug will make the generic product less safe and effective, and finding that the Government had established a reasonable possibility that the safety and effectiveness of respondent's generic drug products might be affected by differences between their inactive "excipients" and those found in approved products, the court enjoined respondent from distributing the products in question. The Court of Appeals vacated the injunction and remanded with instructions to dismiss the complaint, holding that the statutory prohibition against the sale of a "new drug" without prior FDA approval does not apply to a drug product having the same active ingredients as a previously approved drug product, regardless of any differences in "excipients."

Held: A generic product is a "drug" within the meaning of the indicated definition in § 201(g)(1). That definition is broad enough to encompass entire drug products, complete with their active and inactive ingredients. Accordingly, a generic drug product is a "new drug," subject to prior FDA approval, until the product (and not merely its active ingredients) no longer falls within the terms of § 201(p). Pp. 457-461.

654 F.2d 1114, reversed.

Jerrold J. Ganzfried, New York City, for petitioner.

Robyn Greene, Miami, Fla., for respondents.

Justice STEVENS delivered the opinion of the Court.

The question presented is whether the statutory prohibition against the marketing of a "new drug" without the prior approval of the Food and Drug Administration (FDA) requires the respondent to have approved new drug applications (NDAs) before it may market its generic drug products. In statutory terms, we are required to determine whether the term "drug" as used in the relevant sections of the Federal Food, Drug, and Cosmetic Act (Act), as amended, 21 U.S.C. §§ 301 et seq., refers only to the active ingredient in a drug product or to the entire product. We hold that Congress intended the word to have the broader meaning.

I

The active ingredients in most prescription drugs constitute less than 10% of the product; inactive "excipients" (such as coatings, binders, and capsules) constitute the rest. The term "generic drug" is used to describe a product that contains the same active ingredients but not necessarily the same excipients as a so-called "pioneer drug" that is mar- keted under a brand name.¹ Respondent Generix is a distributor of generic drugs manufactured by other firms.

The Government initiated this action to enjoin Generix from distributing in interstate commerce a number of generic drug products that contain eight specified active ingredients.² It alleged that the FDA had never approved new drug applications with respect to any of those products.³

The District Court held that a generic drug product containing the same active ingredients as a previously approved pioneer drug is a "new drug," requiring an NDA, only if there is a reasonable possibility that the differences in excipients between the generic product and the pioneer will make the generic product less safe and effective. 498 F.Supp. 288, 292. The Court found clear evidence in support of the general proposition that differences in excipients may affect the safety and effectiveness of drug products. Excipients may affect the rate at which the active ingredient is delivered to a diseased organ. If delivery is too fast, the patient may be harmed just as if he received an overdose; if delivery is too slow, the treatment of the disease may be ineffective. Id., at 291.

In this case, the District Court found that the Government had established a reasonable possibility that the safety and effectiveness of six of respondent's generic drug products might be affected by differences between their excipients and those found in approved products.⁴ Accordingly, it enjoined the defendants from further distribution of products containing the designated active ingredients.

The Court of Appeals for the Fifth Circuit, now the Eleventh Circuit, vacated the District Court's injunction and remanded with instructions to dismiss the complaint. 654 F.2d 1114. It held that the statutory prohibition against the sale of a "new drug" without prior approval does not apply to a drug product having the same active ingredients as a previously approved drug product, regardless of any differences in excipients. It based that conclusion on its view that the statutory requirement of evaluating the safety and effectiveness of new drugs must normally relate to active ingredients, because the precise technique of formulating the finished drug is not part of the information generally known to the medical or scientific community. Moreover, it believed that the legislative history suggested that Congress had not intended to create a product-by-product licensing system. Since the active ingredients at issue had all received the necessary approval, the Court of Appeals concluded that the Government was entitled to no relief at all.

Because the question is obviously important and because it has been decided differently in other circuits,⁵ we granted certiorari. 455 U.S. 988, 102 S.Ct. 1610, 71 L.Ed.2d 847.⁶

II

In resolving the narrow issue presented, the Court of Appeals misread the statutory text.

Section 201(p) of the Act defines a "new drug" to be "any drug . . . [which] is not generally recognized as safe and effective . . . or . . . which has not, otherwise than in [safety and effectiveness] investigations, been used to a material extent or for a material time. . . ." ⁷ The Court of Appeals did not rest its decision on a finding that Generix's products are generally recognized as safe and effective; rather, its conclusion rested on the proposition that the statutory phrase "any drug" does not include a complete drug product, but only an active ingredient. That proposition is simply untenable.

The original Federal Food and Drugs Act of June 30, 1906, 34 Stat. 768, prohibited the sale of adulterated or misbranded foods or drugs. The definition of the term "drug" in that statute was plainly broad enough to describe a completed drug product. It provided:

"That the term 'drug,' as used in this Act, shall include all medicines and preparations recognized in the United States Pharmacopoeia or National Formulary for internal or external use, and any substance or mixture of substances intended to be used for the cure, mitigation, or prevention of disease of either man or other animals." 34 Stat. 769.

In 1938, Congress passed the new statute, which requires that an application be submitted to the FDA before any "new drug" may be introduced into interstate commerce. Federal Food, Drug, and Cosmetic Act of 1938, 52 Stat. 1040, 21 U.S.C. §§ 301 et seq. The new Act's definition of the term "drug" is even broader than the old one:

"[201](g)(1) The term 'drug' means (A) articles recognized in the official United States Pharmacopeia, official Homoeopathic Pharmacopoeia of the United States, or official National Formulary, or any supplement to any of them; and (B) articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals; and (C) articles (other than food) intended to affect the structure or any function of the body of man or other animals; and (D) articles intended for use as a component of any article specified in clauses (A), (B), or (C) of this paragraph; but does not include devices or their components, parts, or accessories." 52 Stat. 1041, as amended, 21 U.S.C. § 321(g)(1).

In examining this statutory definition, the Court of Appeals was persuaded that only active ingredients come within the terms of subsection (A). 654 F.2d, at 1116.⁸ Unfortu- nately, the Court did not analyze the entire definition. If it had done so, it would have noted both that the terms of subsections (A), (B), and (C) are plainly broad enough to include more than just active ingredients, and also that they must do so unless subsection (D) is to be superfluous. Because the definition is disjunctive, generic drug products are quite plainly drugs within the meaning of the Act.

The natural reading of this definition is corroborated by other sections of the Act. Section 501(a) provides that a "drug" is deemed adulterated "if it is a drug which bears or contains, for purposes of coloring only, a color additive which is unsafe." 52 Stat. 1049, as amended, 21 U.S.C. § 351(a)(4). Section 502(e) provides that a "drug . . . fabricated from two or more ingredients" shall be deemed to be misbranded unless its label includes "whether active or not, the established name and quantity or...