Genus Med. Techs., LLC v. U.S. Food & Drug Admin.
| Decision Date | 06 December 2019 |
| Docket Number | Civil Action No. 19-544 (JEB) |
| Citation | 427 F.Supp.3d 74 |
| Parties | GENUS MEDICAL TECHNOLOGIES, LLC, Plaintiff, v. UNITED STATES FOOD AND DRUG ADMINISTRATION, Defendant. |
| Court | U.S. District Court — District of Columbia |
Sara Wexler Koblitz, Douglas B. Farquhar, Hyman, Phelps & McNamara, P.C., Washington, DC, for Plaintiff.
Jason Lee, U.S. Department of Justice, Washington, DC, for Defendant.
Those drinking the contrast agent Vanilla SilQ before undergoing an X-ray or other imaging procedure likely spend no time pondering the central issue in this case: is this barium-sulfate product a drug or is it a medical device?
Plaintiff Genus Medical Technologies, LLC manufactures Vanilla SilQ products — a line of contrast agents that are used to image structures or fluids within the body. Defendant Federal Drug Administration has authority to regulate medical products like Genus's to assure their safety and efficacy. Under the Federal Food, Drug, and Cosmetic Act (FDCA), the agency can regulate products as, inter alia , drugs or devices. The regulatory path the FDA chooses — that is, whether it treats a product as a drug or a device — implicates significantly different pre-market review and post-market compliance requirements under the Act and implementing regulations. Drugs are subject to a more rigorous regimen, which costs its sponsor considerably more money.
The FDA here concluded that although the Vanilla SilQ products appeared to qualify as devices under the FDCA, they were also drugs and could be regulated accordingly. Plaintiff responded with this suit, and the parties have now cross-moved for summary judgment. Finding the agency's action to be inconsistent with the Administrative Procedure Act and the FDCA, the Court will grant Plaintiff's Motion for Summary Judgment and deny the FDA's Cross-Motion.
To provide context for the factual background, the Court first sets out the statutory scheme.
The FDCA, 21 U.S.C. § 301 et seq. , grants the FDA, as the designee of the Secretary of Health and Human Services, the authority to regulate medical products, including "drugs" and "devices." Id. §§ 321(g)–(h), 393. The Act, in relevant part, defines "drug" to include:
articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals.
Id. § 321(g)(1). It defines "device" in part, conversely, to mean:
Id. § 321(h).
Comparing these definitions yields two conclusions that are relevant here: first, all FDA-regulated diagnostic "devices" meet the "drug" definition. That is because of the overlap in the intended-use portions of their definitions. Id. §§ 321(g)(1), (h) (). Second, the critical difference between the two is that the device definition includes two exclusionary clauses. Specifically, a device, unlike a drug, neither achieves "its primary intended purposes through chemical action within or on the body of man" nor is "dependent upon being metabolized for the achievement of its primary intended purpose." § 321(h); see also ECF No. 17 (Joint Appendix (JA)) at FDA213 ().
The statutory distinctions between a drug and a device have meaningful and practical consequences. For starters, the FDA has established separate bureaucratic centers that oversee the pre-market review and post-market regulation of drugs as opposed to devices. The Center for Drug Evaluation and Research (CDER) has primary jurisdiction over drugs, while the Center for Devices and Radiological Health (CDRH) has primary jurisdiction over medical devices. See 21 C.F.R. § 3.5 ; Intercenter Agreement Between the Center for Drug Evaluation and Research and the Center for Devices and Radiological Health, U.S. Food & Drug Admin. (Oct. 31, 1991), https://www.fda.gov/combination-products/classification-and-jurisdictional-information/intercenter-agreement-between-center-drug-evaluation-and-research-and-center-devices-and. Each center has its own requirements for marketing authorization.
To market new prescription drugs, for example, a sponsor — generally the manufacturer — must submit a new-drug application demonstrating that the drug is safe and effective for its proposed use. See 21 U.S.C. § 355(a) – (b). This process requires an extensive series of safety and effectiveness trials before approval. Id. § 355(b). If the prospective drug is the "same as" an existing drug already on the market, however, the sponsor can obtain approval through the less onerous abbreviated new-drug application process. Id. § 355(j). This abbreviated process requires proof that the drug in question has the same active ingredients, effects, and labeling as a predecessor drug that the FDA has already approved. Id.; 21 C.F.R. § 314.94(a).
By contrast, devices are reviewed and classified into three categories based on the risk they pose to the public. Class I devices are low risk — i.e. , they "present no unreasonable risk of illness or injury" — and "are subject only to minimal regulations by ‘general controls.’ " Medtronic, Inc. v. Lohr, 518 U.S. 470, 476–77, 116 S.Ct. 2240, 135 L.Ed.2d 700 (1996) (quoting 21 U.S.C. § 360c(a)(1)(A) ). Class II devices "are potentially more harmful": "[A]lthough they may be marketed without advance approval, manufacturers of such devices must comply with federal performance regulations known as ‘special controls.’ " Id. at 477, 116 S.Ct. 2240 (quoting 21 U.S.C. § 360c(a)(1)(B) ). Lastly, high-risk devices are designated as Class III. See 21 U.S.C. § 360c(a)(1)(C). To introduce a new Class III device into the market, "the manufacturer must provide the FDA with a ‘reasonable assurance’ that the device is both safe and effective." Medtronic, 518 U.S. at 477, 116 S.Ct. 2240 (quoting 21 U.S.C. § 360e(d)(2) ). To provide a "reasonable assurance," the manufacturer undergoes a pre-market approval process, which requires "detailed information regarding the safety and efficacy" of its device. Id.
Additionally, significant cost differences exist in both the development and the continued sale of drugs and devices. Plaintiff avers that the cost of seeking clearance to market its products as devices is estimated to be $60,000, whereas seeking approval to market them as drugs could be over half a million dollars in addition to a continuing annual cost north of $186,000. See ECF No. 9 (Plaintiff's MSJ), Exh. 8 (Declaration of John E. Powers), ¶¶ 31–33.
When the classification of a product — viz. , as a drug or a device — is unclear or in dispute, a sponsor can file a request for designation (RFD) to obtain a formal, binding determination from the FDA as to the "classification of the product ... or ... the component of the [FDA] that will regulate the product." 21 U.S.C. § 360bbb-2(a). The relevant "components" here include the CDRH — which, again, regulates devices — and the CDER — which regulates drugs. Sponsors submit RFDs to the Office of Combination Products, which is part of the FDA's Office of the Commissioner. The Act requires OCP to respond to RFDs no later than 60 days after they are filed. Id. § 360bbb-2(b). If it fails to do so, the classification or assignment recommended by the sponsor becomes operative. Id. § 360bbb-2(c). A classification or assignment made through the RFD process can be changed only with the sponsor's written consent or for "public health reasons based on scientific evidence." Id. § 360bbb-2(b).
Since 2015, Genus has manufactured "Vanilla SilQ" — a line of barium-sulfate oral-solution contrast agents. See ECF No. 1 (Complaint), ¶ 25; JA at FDA8. These products are "ingested for diagnostic purposes." JA at FDA14. The physical and chemical properties of barium sulfate — particularly its opacity — enable health-care providers to better visualize the gastrointestinal tract when performing X-rays or computer tomography
(commonly referred to as a CT scan ). Id. at FDA8. Significantly, because it is an inert metal salt, barium sulfate does not chemically interact with human cells or tissue to serve its purpose. Id. Ingesting it does not affect the chemical bonds or molecular structure of the gastrointestinal system or form new substances. Id. at FDA8, FDA14. Further, when used as a contrast agent, it is "neither absorbed nor metabolized" by the body. Id. at FDA15.
Genus maintains that before and after it started producing Vanilla SilQ, it sought FDA clearance to distribute its products as devices. Id. at FDA55. Alternatively, Plaintiff purported to establish that — for reasons that are inapplicable here — its products were exempted from drug regulation. Id. at FDA58, FDA135 (citing 21 U.S.C. § 321(p)(1) ).
In June 2016, the FDA conducted a three-day inspection of Plaintiff's distribution facility. Id. at FDA134. On May 2, 2017, it issued a Warning Letter, notifying Genus that its products were "drugs" within the meaning of the Act. Id. at FDA135 (citing 21 U.S.C. § 321(g)(1) ). It further explained that because the products "are not generally recognized as safe and effective for use under the conditions prescribed, recommended, or suggested in their labeling," they were also "new drugs" under the statute. Id. (citing 21 U.S.C. §...
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Genus Med. Techs. LLC v. U.S. Food & Drug Admin.
...would be approximately $60,000 to seek device clearance for Vanilla SilQ—the product line in question here. Genus Med. Techs., LLC v. FDA , 427 F. Supp. 3d 74, 78 (D.D.C. 2019). If, however, the same product line were classified as drugs, Genus estimates that it would cost them more than $5......