U.S. v. 225 Cartons, More or Less of an Article or Drug, 1

Citation871 F.2d 409
Decision Date27 March 1989
Docket NumberP,No. 2,No. 1,No. 88-5481,No. 1 and F,1,2,1 and F,88-5481
PartiesUNITED STATES of America v. 225 CARTONS, MORE OR LESS, OF AN ARTICLE OR DRUG, Each Carton Containing 12/100 Capsule Bottles Labeled in part: (carton) " * * * Sandoz Pharmaceuticals East Hanover NJ 07936 * * * " With an Area Cut Out Showing Bottle Labeling Described Below: (bottle) " * * * Fiorinal With Codeine* * * Sandoz, Inc. East Hanover, N.J. * * * " (insert attached to bottle) "Fiorinal With Codeine Capsule * * *." 144 Packages, More Or Less, of An Article of Drug, Each Package Containing 12/100 Capsule Bottles and Covered by an Unlabeled, See-Through Cellophane Overwrap, Labeled in Part: (bottle) " * * * Fiorinal With Codeine* * * Sandoz Inc. East Hanover, N.J. * * * " (insert attached to bottle) "Fiorinal With Codeine Capsules * * * " 4,780 Blister Packs, More Or Less, of an Article of Drug, Each Blister Pack Containing 20 Capsules and One Insert, Labeled in Part: (blister pack) and Undetermined Quantities of The Drug, Fiorinal With Codeine and Fiorinal With Codeineackaged And Labeled as Described Above. Appeal of SANDOZ PHARMACEUTICALS CORPORATION ("Sandoz").
CourtUnited States Courts of Appeals. United States Court of Appeals (3rd Circuit)

Peter O. Safir (argued), Bonnie A. Beavers, Kleinfeld, Kaplan & Becker, Washington, D.C., for appellant.

Samuel A. Alito, Jr., U.S. Atty., Jerome L. Merin, Deputy Chief, Civil Div., Newark, N.J., Eric M. Blumberg (argued), Associate Chief Counsel, Food and Drug Admin. (Thomas Scarlett, Chief Counsel, Jeffrey B. Springer, Deputy Chief Counsel, Food and Drug Admin., of counsel), Rockville, Md., for appellee.

Before SLOVITER and BECKER, Circuit Judges, and POLLAK, District Judge. *


SLOVITER, Circuit Judge.

Appellant Sandoz Pharmaceuticals Corporation has been unsuccessful in its attempt to obtain Food and Drug Administration (FDA) approval of its new drug applications for the products in question under the usual premarket clearance procedures required by 21 U.S.C. Sec. 355(a) & (b). Its contention that the products can nonetheless be distributed in commerce rests on its claim that they are "generally recognized" to be safe and effective, a claim the district court rejected. The issue presented on appeal requires this court to interpret for the first time the regulation promulgated by the FDA governing the effectiveness of "combination" prescription drug products, i.e., products containing fixed combinations of ingredients, some or all of which may have been granted prior approval by the FDA. See 21 C.F.R. Sec. 300.50 (1988).

I. Facts

The facts are fully set forth in the comprehensive opinion of Judge Debevoise reported at United States v. 225 Cartons More or Less, of an Article of Drug, 687 F.Supp. 946, 948-53 (D.N.J.1988), and we set forth only those essential to our discussion.

Sandoz has been marketing products containing Fiorinal and codeine since 1963. In 1968, the FDA revoked all prior advice that such products were not regarded as new drugs, see 21 C.F.R. Sec. 310.100(d) (1988), because the Food, Drug and Cosmetic Act, 21 U.S.C. Sec. 301 et seq. (FDC Act), was amended in 1962 to require the FDA to evaluate the effectiveness as well as the safety of all drug products that had been placed in commerce since 1938, with certain exceptions for "grandfathered" products not applicable here. See generally Weinberger v. Hynson, Westcott and Dunning, Inc., 412 U.S. 609, 613-16, 93 S.Ct. 2469, 2475-76, 37 L.Ed.2d 207 (1973) (discussing 1962 amendments); Warner-Lambert Co. v. Heckler, 787 F.2d 147, 156 (3d Cir.1986) (same).

The effect of this revocation was to require that manufacturers file a new drug application (NDA) as required under 21 U.S.C. Sec. 355(b) for all such products, except that an abbreviated new drug application (ANDA) could be used, if approved by the FDA, for duplicates of approved drugs or drugs "very closely related" thereto. See 21 C.F.R. Sec. 314.56 (1988). In 1973, Sandoz submitted an NDA for Fiorinal, an analgesic containing aspirin, caffeine, phenacetin and the barbiturate butalbital. In 1977, the FDA approved Fiorinal as a "new drug" effective for treating tension headaches following its evaluation under the specially established procedure for "drug efficacy study implementation" (DESI) with the assistance of panels of the National Academy of Sciences. See 42 Fed.Reg. 59,115 (1977).

Thereafter, Sandoz sought to get FDA's approval for its Fiorinal with Codeine (FWC) products through the abbreviated procedure applicable to products closely related to products previously approved. See 21 C.F.R. Sec. 314.55(a) (1988). The products for which approval was sought through the abbreviated procedure were the prescription drug products Fiorinal with 7.5 mg. of codeine phosphate (FWC No. 1) and Fiorinal with 15 mg. of codeine phosphate (FWC No. 2). 1 The FDA twice rejected these abbreviated applications for the FWC products on the ground that the approved products on which Sandoz sought to "piggy back" the FWC applications, plain Fiorinal and Trigesic with Codeine, contained different ingredients. Sandoz did not appeal these decisions. 2

The FDA advised Sandoz at a meeting in 1978 that Sandoz's FWC products were considered new drugs and would require the filing of full new drug applications, that Fiorinal with Codeine is not related to any DESI drug indicated for pain states because of the presence of the barbiturate butalbital which has not been proven effective in analgesia, and that the process permitting ANDAs for similar, identical, or related drugs was not intended to permit drug sponsors to avoid the required clinical testing. At the same meeting the FDA advised Sandoz that it believed that FWC No. 1, containing the lowest dosage of codeine, would probably not meet the requisite test of effectiveness.

At the time Fiorinal had been approved as efficacious it had contained phenacetin as one of its ingredients. In 1983, the FDA required removal of phenacetin and Sandoz substituted additional aspirin as permitted by the FDA. See 47 Fed.Reg. 34,636, 34,640-41 (1982).

Thereafter, in 1984 and 1985, the FDA sent Sandoz Regulatory Letters that the FWC products were unapproved new drugs covered by a 1980 notice finding other barbiturate analgesic combination drugs to be lacking substantial evidence of effectiveness. The letters warned Sandoz that it could not continue to market the FWC products without submission of the necessary NDAs. Sandoz submitted both a full new drug application and another request that the FDA accept the abbreviated applications for the FWC products based on the earlier approval of Fiorinal. The FDA's preliminary review of the new drug application was unfavorable and it rejected the request with respect to the abbreviated application. In letters dated April 26 and May 16, 1985, Sandoz submitted to the FDA an unpublished clinical trial study and two published studies along with declarations from three physicians who had examined the published studies and who gave their opinions that the FWC products were not new drugs because they were generally recognized as safe and effective for their intended uses.

II. Procedural History

The FDA filed a complaint for forfeiture of the FWC products in October 1986, alleging that they were "new drugs" within the meaning of 21 U.S.C. Sec. 321(p) and could not be marketed without obtaining FDA approval through the filing of a new drug application. The complaint also alleged that the drugs were misbranded because they were being sold without labels containing adequate directions for their use, a requirement from which they were not exempt in light of their status as unapproved new drugs. In January 1987, a United States Marshal seized the FWC products. Sandoz intervened as claimant.

The FDA moved for summary judgment contending that there was no genuine issue of material fact regarding Sandoz's failure to meet the legal standard for exemption from the requirements for new drug approval. After evaluating documentary evidence submitted by both parties, the district court granted the government's summary judgment motion, holding that it had sustained its burden of demonstrating the absence of a genuine issue of material fact. 687 F.Supp. at 956.

Sandoz appeals, arguing that the district court incorrectly interpreted the legal standards applicable to this case and improperly granted summary judgment when issues of material fact remained in dispute. Our review of the legal standard formulated by the district court is plenary. See Dent v. Cunningham, 786 F.2d 173, 175 (3d Cir.1986). For the reasons set forth below, we will affirm the district court's judgment.

III. Discussion
A. The "Generally Recognized" Exclusion

Sandoz's principal argument on appeal is that it was not obliged to follow the statutory and regulatory requirements applicable to new drugs because the FWC products seized are "generally recognized" as effective. The FDC Act mandates that no "new drug" may be introduced into interstate commerce until it has been approved by the FDA as safe and effective. 21 U.S.C. Sec. 355(a) & (b). In this case, the FDA's challenge is directed only to efficacy, not safety.

Under the relevant provision of the statute, the term "new drug" means,

Any drug ... the composition of which is such that such drug is not generally recognized, among experts qualified by scientific training and experience to evaluate the safety and effectiveness of drugs, as safe and effective for use under the conditions prescribed, recommended, or suggested in the labeling thereof.

21 U.S.C. Sec. 321(p) (emphasis added). As we explained in Tri-Bio Laboratories, Inc. v. United States, 836 F.2d 135, 141 (3d Cir.1987), cert. denied, --- U.S. ----, 109 S.Ct. 57, 102 L.Ed.2d 35 (1988), the exclusion for "generally recognized" drugs is a narrow one.

The scope of the exclusion for general recognition among experts was considered...

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