U.S. v. Articles of Drug Consisting of Following: 5,906 Boxes, s. 83-1691

• Decision Date: 28 September 1984
• Docket Number: 83-1693,Nos. 83-1691,s. 83-1691
• Citation: 745 F.2d 105
• Parties: UNITED STATES of America, Plaintiff, Appellant, v. ARTICLES OF DRUG CONSISTING OF the FOLLOWING: 5,906 BOXES, etc., Defendants, Appellees. UNITED STATES of America, Plaintiff, Appellant, v. ALCON LABORATORIES (PUERTO RICO), INC., et al., Defendants, Appellees. to 83-1695 and 83-1692.
• Court: U.S. Court of Appeals — First Circuit

Page 105

745 F.2d 105

39 Fed.R.Serv.2d 1481

UNITED STATES of America, Plaintiff, Appellant,

v.

ARTICLES OF DRUG CONSISTING OF the FOLLOWING: 5,906 BOXES,

etc., Defendants, Appellees.

UNITED STATES of America, Plaintiff, Appellant, v. ALCON LABORATORIES (PUERTO RICO), INC., et al., Defendants, Appellees.

Nos. 83-1691, 83-1693 to 83-1695 and 83-1692.

United States Court of Appeals, First Circuit.

Argued June 4, 1984.

Decided Sept. 28, 1984.

Randy S. Chartash, Attorney, Washington, D.C., with whom J. Patrick Glynn, Atty., Civ. Div., Dept. of Justice, Richard K. Willard, Acting Asst. Atty. Gen., Washington, D.C., Daniel Lopez-Romo, U.S. Atty., Gary H. Montilla, Asst. U.S. Atty., Hato Rey, P.R., Thomas Scarlett, Chief Counsel, Forrest T. Patterson, and Arthur Y. Tsien, Associate Chief Counsels for Enforcement, Food and Drug Administration, Washington, D.C., were on brief, for plaintiff, appellant.

Dale B. Hinson, Washington, D.C., with whom James D. St. Clair, P.C., James L. Quarles III, Hale and Dorr, Washington, D.C., Manuel A. Guzman, and McConnell, Valdes, Kelley, Sifre, Griggs & Ruiz-Suria, San Juan, P.R., were on brief, for Alcon Laboratories (Puerto Rico), Inc., et al.

Before CAMPBELL, Chief Judge, STEWART, ^* Associate Justice (Retired), and BOWNES, Circuit Judge.

STEWART, Associate Justice (Retired):

In the present appeal this court reviews for a second time proceedings instituted by the federal Food and Drug Administration (FDA) against Alcon Laboratories (Alcon) and its drug "WANS" (Webster's Anti-Nausea Supprettes). See United States v. Alcon Laboratories, 636 F.2d 876 (1st Cir.), cert. denied, 451 U.S. 1017, 101 S.Ct. 3005, 69 L.Ed.2d 388 (1981). The issues arise under the Federal Food, Drug and Cosmetics Act of 1938 (the Act), 21 U.S.C. Secs. 301-392 (as amended), ¹ which provides a statutory structure for the premarketing approval and regulation of drugs that has been described variously as "somewhat complicated," "not straightforward," and even "inconsistent" in its judicial interpretation. ²

After a seven-day trial in March 1983, a jury answered special interrogatories to the effect that WANS should be exempt from FDA approval because it is currently recognized by experts as safe and effective, and was recognized as safe by experts in 1962. The United States now appeals from that verdict and from the district court's refusal to grant it judgment notwithstanding the verdict (j.n.o.v.).

I. The Statutory Structure.

The Federal Food, Drug and Cosmetic Act was enacted in 1938. It prohibits the introduction of any "new drug" into interstate commerce unless the FDA has approved the drug as "safe and effective." 21 U.S.C. Sec. 355. The statutory definition of "new drug," however, expressly excludes a drug that is

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, ... [and if the drug has] been used to a material extent or for a material time under such conditions.

21 U.S.C. Sec. 321(p).

The requirement that a new drug must be "effective" was not part of the 1938 Act. "Effectiveness" was added when Congress amended the Act in 1962 (the 1962 amendments). See Pub.L. 87-781, Sec. 102, 76 Stat. 781 (Oct. 10, 1962). A "grandfather clause" in the 1962 amendments specifically exempts from the effectiveness requirements some drugs that were on the market in the United States before the 1962 amendments, if certain conditions are met. Id., Sec. 107(c)(4), reprinted at 21 U.S.C. Sec. 321 (note). Because this grandfather clause is central to Alcon's case, we quote it in full:

In the case of any drug which, on the day immediately preceding the enactment date [i.e., October 9, 1962], (A) was commercially used or sold in the United States, (B) was not a new drug as defined by section 201(p) of the basic Act as then in force, and (C) was not covered by an effective application under section 505 of that Act, the amendments to section 201(p) made by this Act shall not apply to such drug when intended solely for use under conditions prescribed, recommended, or suggested in labeling with respect to such drug on that day.

This clause thus sets forth four conditions that must have been true as of October 1962 for a drug to be exempt from the Act as amended:

(A) the drug must have been commercially used or sold in this country before 1962;

(B) it must not have been within the definition of a "new drug" in the 1938 Act;

(C) it must not have been covered by an effective new drug application;

and

(D) it must currently be "intended solely for use under conditions" prescribed or recommended in its 1962 labeling.

See Alcon Laboratories, supra, 636 F.2d at 879. With regard to condition (B), the Act's definition of a "new drug" before the 1962 amendments was identical to the present definition quoted above (21 U.S.C. Sec. 321(p)), except that "effectiveness" was not included. General recognition by experts for safety, however, has been a requirement for exemption from new drug approval procedures since 1938.

Thus the 1962 grandfather clause simply relieved manufacturers of pre-1962 drugs from having to demonstrate the effectiveness of their drugs, so long as the drugs were generally recognized among experts as safe for certain uses in 1962 and no new conditions of use for the drug are suggested by the manufacturer. As Senator Eastland explained in 1962, "[e]stablished drugs which have never been required to go through new drug procedures will not be affected by the new effectiveness test insofar as their existing claims are concerned." 108 Cong.Rec. 17366 (Aug. 23, 1962); see USV Pharmaceutical Corp. v. Weinberger, 412 U.S. 655, 664, 93 S.Ct. 2498, 2504, 37 L.Ed.2d 244 (1973). But even drugs that were on the market before 1962 must either have been generally recognized as safe in 1962 or be approved today by the FDA.

II. Facts and Proceedings Below.

WANS is a rectal suppository drug sold to alleviate the symptoms (but not the underlying causes) of nausea and vomiting. In medical terms it is an "antiemetic," or anti-vomiting, drug. WANS contains two active ingredients: pyrilamine maleate (an antihistamine) and pentobarbital sodium (a barbituate). WANS also contains "inactive" ingredients in the wax base that is used to bond together the two active ingredients. ³ WANS is manufactured in three different strengths, two for adults and one for children, and has been sold in this country since 1955 (1956 for the childrens' dosage). It was uncontested at trial that in the decade from 1970-1980, over 4 million persons used WANS. ⁴

Although WANS was clearly a "new drug" in 1955, ⁵ Alcon never submitted it for FDA approval. Commercial sale of WANS proceeded apparently without incident until 1967. In that year, an FDA official came upon a magazine advertisement for WANS which stated that WANS was "completely safe." Characterizing that description as "untrue and misleading," the official recommended that the FDA take some action against the drug. The FDA subsequently wrote to the manufacturer of WANS ⁶ and "urged" it to "review" the advertising for WANS. The FDA suggested a number of specific changes in WANS's advertising and promotional literature, and after an exchange of further correspondence all these changes were adopted in WANS's promotional materials. ⁷ In a subsequent letter, the agency notified the manufacturer that the new advertising materials "appear[ed] to be consistent with [the FDA's] suggestions." The letter expressly noted, however, that the FDA's satisfaction with the new WANS labeling "is not to be in any way construed as constituting official approval either as to the safety or efficacy" of WANS.

In 1975, the FDA began to study the possibility of a relationship between the use of "common medications," such as aspirin, and Reye's Syndrome, a serious childhood disease discovered in the early 1960s and still not fully understood. Because sudden vomiting is a symptom of Reye's Syndrome, one of the types of medication that the FDA focused on was antiemetics such as WANS. In 1976, the FDA assembled an ad hoc panel of experts to study "the role of medications in Reye's Syndrome." This ad hoc committee found that the effectiveness of antiemetics was not demonstrated by any existing studies, and noted that there can be health concerns if antiemetics are used in certain circumstances. The ad hoc committee did not come to any firm conclusions about the safety of antiemetic drugs, but the committee did recommend further study by the FDA. In February 1977, a second FDA committee of experts, the Neurologic Drugs Advisory Committee, noted that "there is a safety issue on [the use of] antiemetics in children." After discussion, however, the Advisory Committee also decided only to request "further information" on the issue from the FDA.

Against this background, the FDA notified Alcon on March 17, 1978, that it believed WANS was being sold unlawfully because it had never been subjected to the FDA's "new drug" approval requirements. The FDA stated that it was "unaware of substantial scientific evidence which demonstrates that WANS is generally recognized as safe and effective for the treatment of nausea and vomiting." ⁸ In response, Alcon claimed that WANS was not a "new drug" as defined in the Act and was therefore exempt from the evidentiary requirements relevant to FDA approval.

Consequently, the FDA sought an injunction against the further distribution of WANS under 21 U.S.C. Sec. 332(a) as a "misbranded" and unapproved "new drug." See 21 U.S.C. Secs. 331(a) & (d), Sec. 352(f)(1). When its motion for a temporary restraining order was denied, the FDA also instituted four seizure actions against WANS under 21 U.S.C. Sec. 334, and large quantities of WANS were seized pending judgment by the court. The injunction and the...