US v. Premo Pharmaceutical Laboratories

Decision Date20 January 1981
Docket NumberCiv. No. 80-699.
Citation511 F. Supp. 958
PartiesUNITED STATES of America, Plaintiff, v. PREMO PHARMACEUTICAL LABORATORIES, INC., a corporation, and Seymour N. Blackman, an individual, Defendants.
CourtU.S. District Court — District of New Jersey

Charles J. Walsh, Asst. U. S. Atty., Newark, N. J., Donald O. Beers, Associate Chief Counsel for Enforcement of Food and Drug Administration, Rockville, Md., for plaintiff.

Henry J. Catenacci, Podvey & Sachs, Newark, N. J., John S. Eldred, and Deborah Shur Trinker, Keller & Heckman, Washington, D. C., for defendants.


LACEY, District Judge.


The United States sues to enjoin defendants from continuing their alleged violations of the Federal Food, Drug, and Cosmetic Act (Act), 21 U.S.C. §§ 301-392 (1976 & Supp. I 1977). These violations, as charged in the complaint, are that defendants are marketing human drugs in interstate commerce without the requisite approval of the Food and Drug Administration (FDA), and without the testing required to show that the drugs are safe and effective for their intended uses.

Defendant Premo Pharmaceutical Laboratories, Inc. (Premo) is a manufacturer and distributor of prescription drugs. Defendant Seymour N. Blackman, Premo's president, has responsibility for and authority over operation of the corporation. Involved are the following drug products manufactured by Premo: (1) triamterene with hydrochlorothiazide capsules, marketed by Premo under the name Triamthiazide — a generic version of Dyazide, manufactured by Smith, Kline and French (used in the treatment of hypertension and edema); (2) allopurinol tablets — a generic version of Zyloprim, marketed by Burroughs Wellcome (used in the treatment of the symptoms of gout); (3) chlorthalidone tablets — a generic version of the chlorthalidone tablets manufactured by USV Pharmaceuticals under the name Hygroton (used in the treatment of hypertension and edema); (4) betamethasone valerate cream, marketed by Premo under the name Beta Val — a generic version of Valisone, produced by Schering Company (used in the treatment of various dermatological conditions); (5) trifluoperazine hydrochloride tablets — a generic version of the trifluoperazine tablets marketed by Smith, Kline and French under the name Stelazine (used in the management of manifestations of psychotic disorders); (6) doxylamine succinate and pyridoxine hydrochloride tablets, marketed by Premo under the name Doxine — a generic version of Bendectin, manufactured by Merrell-National Laboratories (used to relieve nausea and vomiting during the early months of pregnancy); (7) hydroxyzine pamoate capsules, marketed by Premo under the name Hy Pam — a generic version of the antihistamine Vistaril produced by Pfizer Pharmaceuticals (used in the management of emotional distress, anxiety, tension, and psychomotor agitation); and (8) hydroxyzine hydrochloride tablets — a generic version of the antihistamine Atarax produced by Pfizer (uses similar to that for Vistaril). As indicated, these products are all generic (or "me-too") versions of FDA-approved "brand name," or "pioneer," medications. It is Premo's version of each of these established products that is in dispute here.

Specifically, the Government charges that the eight drugs just described are "new drugs" within the meaning of 21 U.S.C. § 321(p) (1976), and thus Premo is in violation of section 355(a) of the Act for shipping these products without having first submitted to FDA, and having had approved, a new-drug application (NDA) or an abbreviated new-drug application (ANDA). Section 321(p) provides:

The term "new drug" means —
(1) Any drug (except a new animal drug or an animal feed bearing or containing a new animal 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, except that such a drug not so recognized shall not be deemed to be a "new drug" if at any time prior to June 25, 1938 it was subject to the Food and Drugs Act of June 30, 1906, as amended, and if at such time its labeling contained the same representations concerning the conditions of its use; or
(2) Any drug (except a new animal drug or an animal feed bearing or containing a new animal drug) the composition of which is such that such drug, as a result of investigations to determine its safety and effectiveness for use under such conditions, has become so recognized, but which has not, otherwise than in such investigations, been used to a material extent or for a material time under such conditions.

21 U.S.C. § 321(p) (1976). Section 355(a) provides:

No person shall introduce or deliver for introduction into interstate commerce any new drug, unless an approval of an NDA is effective with respect to such drug.

Id. § 355(a).

Defendants concede new drugs must receive an approved NDA from FDA prior to marketing; however, they deny that their products are "new drugs" within the meaning of the Act. Defendants' position is based on the fact that the active ingredients — and in some cases the inactive ingredients as well — in their generic medications are the same as those in their FDA-approved, pioneer counterparts.

The United States contends that differences in inactive ingredients between two products with the same active ingredients can materially affect the safety and effectiveness of the medication; that the "same" active ingredient from different sources may cause different effects; and that, even if all ingredients are the same, differences in manufacturing practices can cause one manufacturer's product to differ substantially from another in safety and effectiveness.

At the outset of this action, the Government sought a temporary restraining order. That application, based upon a relatively modest submission, was denied, in part because of defendants' agreement to refrain from further shipments of Triamthiazide (triamterene with hydrochlorothiazide), the medication apparently considered by the United States to have the greatest potential for harm. Thereafter, the Government brought on this application for a preliminary injunction.

Given the extent of the disagreement between the parties, the importance of this issue to the public health and safety, and the uncertain state of the law in this circuit, I afforded the parties a broad opportunity to present their evidence and arguments. The resultant record is perhaps the most detailed one developed to date in any case considering the generic/new-drug issue.1 Testimony was presented over eleven days on each of the eight products named in the complaint, producing in excess of 2,000 transcript pages. This was supplemented by 2,000 pages of affidavits and depositions, more than 400 pages of pre- and posthearing briefing, and 1,000 pages of other posthearing submissions.

For the reasons hereinafter set forth, the Government's motion for preliminary injunctive relief is granted.

A word about the format of this opinion, and my findings and conclusions of law, is appropriate.

The first portion of this opinion, "DISCUSSION," pp. 962-977 infra, is divided into six parts. Part I provides a brief history of federal regulation of the drug industry. Part II discusses factors that can affect the bioavailability and bioequivalence of drug products, two concepts central to this litigation. Parts III and IV examine the scant but developing law on the generic/new-drug issue and analyze the evidence in light of my determination that the law requires me to resolve only this question in deciding whether a drug product is a "new drug" under the Act: Is the product generally recognized as safe and effective by experts qualified by scientific training and experience to make such a determination? Part V considers certain additional arguments raised by defendants, and Part VI concludes that the Government is entitled to injunctive relief.

The second portion of this opinion is intended to advance appellate review in the event the court of appeals decides that the determinative issues are broader than the issue of expert recognition of safety and efficacy. Thus, under my Findings of Fact I have referred to not only the evidence considered under "DISCUSSION," but also that which was received conditionally and is now determined by me to be irrelevant. See p. 961, note 1 supra.


The Food and Drug Act of 1906, ch. 3915, 34 Stat. 768, was the first legislation of national scope directed at the regulation of drug products. The Act set standards of purity for drugs sold in the United States and required accurate labeling of the drugs' contents. Id. §§ 1, 2, 7. The Act also made unlawful the marketing of adulterated or misbranded drugs and provided for removal of such drugs from the market through libel actions. Id. § 2. There were, however, no provisions regulating false claims of efficacy until the Food and Drug Act of 1906 was amended in 1912 to declare misbranded drugs that were not effective for use under the conditions for which they were recommended.1a

The greatest defect in the Act, however, was its failure to provide any mechanism for premarketing agency clearance. It was impossible to prevent an unsafe or ineffective drug from reaching the market. In 1938 the "wonder drug" "Elixir of Sulfanilamide," a solution based on diethylene glycol and (significantly for the present case) a presumed harmless, inert solvent ingredient, went on the market. Apparently, no tests for toxicity were performed prior to marketing; and almost one hundred people died before the drug could be withdrawn.

This Sulfanilamide tragedy led to the Federal Food, Drug, and Cosmetic Act of 1938, 21 U.S.C. §§ 301-392 (1976 & Supp. I 1977) (amended 1962), with provisions for premarketing review of new drugs. This review,...

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