United States Supreme Court Decides that FDA Impossibility Pre-emption is a Matter for Judges, not Jurors

Jordan Lipp, Esq. | Managing Member, Childs McCune

It is a basic tenant of Constitutional law that if it is impossible to comply with both state and federal law, the state law is preempted and only the federal law controls. This is referred to as “impossibility pre-emption,” and is a frequently litigated issue regarding products regulated by the FDA, especially drugs. In approving warnings, the FDA is concerned not just with warning, but also preventing “overwarning” and making sure that warning language does not exaggerate the risk. In state law personal injury actions, however, plaintiffs frequently argue that the drug company should have provided more warnings or stronger warnings. This creates the significant possibility that a company regulated by the FDA may be put in a situation where the FDA does not permit it to over-warn under federal law, but at the same time it is faced with state law litigation arguing that it was required to over-warn by state tort law. When caught between this impossible position of not being able to comply with both federal and state law, the state law is preempted. When the state law is preempted, the personal injury lawsuit must be dismissed.

As the United States Supreme Court has stated (in a wonderfully confusing string of negatives): “‘absent clear evidence that the FDA would not have approved a change’ to the label, the Court ‘will not conclude that it was impossible . . . to comply with both federal and state requirements.’” Merck Sharp & Dohme Corp. v. Albrecht, No. 17-290, 2019 U.S. LEXIS 3542, at *3 (May 20, 2019) (quoting Wyeth v. Levine, 555 U. S. 555, 571 (2009), ellipses in original). An open question, until now, has been who makes this decision. Does the judge or the jury decide whether the FDA would not have approved a label change?

That question was answered yesterday by the United States Supreme Court. In Merck Sharp & Dohme Corp. v. Albrecht, the Third Circuit decided that it was a question for the jury whether the FDA would have rejected the atypical femoral fractures warning pushed by the plaintiffs in the Fosamax litigation. Merck appealed this decision. Yesterday, the United States Supreme Court disagreed with the Third Circuit. It found that “judges, rather than lay juries, are better equipped to evaluate the nature and scope of an agency’s determination.” Id. at *27. As such, “a judge, not the jury, must decide the pre-emption question.” Id. at *18. And, interestingly enough, all nine justices agreed with the judgment, although for different reasons. While this outstanding question on impossibility preemption has now been answered, the precise scope of impossibility preemption will continue to be litigated for many years.

Supreme Court Cases to Watch This Term

Courtney Young, Esq. | Senior Attorney, Medmarc Risk Management

This term (which began last month), the Supreme Court will hear a number of cases that may affect the life sciences industry. Here are a few we will be watching.

Air and Liquid Systems Corp. v. DeVries

The issue in this case is whether defendants in a products liability case can be held liable under maritime law for injuries caused by products they did not make, sell, or distribute. The Court heard argument in this case on October 10. The case involves equipment sold by various manufacturers and installed several years ago on Navy ships. To function properly, the equipment required asbestos insulation, which was installed shortly after equipment. The plaintiffs are a group of individuals who worked on the ships at the time and were allegedly injured by the asbestos.

Merck Sharp & Dohme Corp. v. Albrecht

This is another preemption case, and an important one for makers of drugs and, potentially, PMA devices. The issue here is whether a plaintiff’s state-law-based failure-to-warn claim is preempted if the FDA rejected the drug manufacturer’s proposal to warn about the specific risk the state-law claim alleges should have been warned about. Argument has not been scheduled in this case yet.

Plaintiff Runs out of Time in Prosthetic Hip Lawsuit

Device makers know all too well they can be hit with a Warning Letter for failure to file a medical device report (MDR) when they reasonably should have known the device was associated with an adverse event, but a plaintiff in a lawsuit over a hip implant recently received the same message. The plaintiff had attempted to argue that the clock for the statute of limitations for a liability claim had not commenced until the implant was removed, but the judge who heard the case said no reasonable juror would have entertained any misgivings about the origins of the symptoms for that long a time.

The implant of the Zimmer hip took place in early 2011, and the plaintiff is said to have “suffered pain and complications as early as September 2012, when she returned to her surgeon due to recurrent pain in the hip. The surgeon initially treated the plaintiff for bursitis, but began to check for evidence of problems directly associated with the device in January 2013. Although imaging scans ruled out any loosening or fracture of the device and joint, there was evidence that metal ion levels were outside the normal range. The plaintiff experienced a dislocation of the hip in November 2014, however, and the physician advised the patient in January 2015 that a revision procedure might be necessary to address the problem.

The plaintiff agreed to undergo revision surgery in January 2015, and the procedure took place the following month. The plaintiff filed suit in February 2017 for strict liability, negligence and  three counts for breach of warranty, and toward the end of May 2018, Zimmer petitioned for summary judgment based on the two-year statute of limitations for such claims under Pennsylvania state law. The plaintiff argued that she could not have been clear on the precise origin of the problems until the device had been removed, but the judge in this case said the plaintiff’s acknowledgment in January 2015 that the device “had to come out” was a clear indication that the patient either already understood – or at least should have recognized – that the device was at the root of the problem.

At the very latest, the plaintiff’s signature on a consent form dated Feb. 9, 2015, which authorized the revision procedure, suggested that the plaintiff ought to have recognized “through the exercise of reasonable diligence,” that the hip implant was the root cause of the difficulties, wrote Judge Edward Smith of the U.S. District Court for the Eastern District of Pennsylvania. The suit was filed two years and one day after that consent form was signed, and Smith said no reasonable juror would have concluded that the plaintiff “was unaware, or should not have been aware” of a connection between the hip dislocation and device until after the revision surgery. While the surgeon confirmed after the revision that the device was, indeed, the cause of her injuries, Smith said that knowledge of precise medical cause is not required to start the clock on the two-year limitations period.

Apple Scores Quick De Novo

The pilot program for the FDA precert framework for software medical devices is still in development, but Apple Inc. scored a win with two apps for its Apple Watch 4 in a remarkably short amount of time. Other companies in the device business, even tech companies toiling in the digital space, might find the quick turn-around time for the de novo applications conspicuous, but the timing of the grant of the de novos was unusual as well.

The FDA posted the granted de novo petitions (here and here) to the agency’s website Sept. 12, the day after the date the petitions were granted. The interesting part of this discussion is that neither premarket filing took more than 33 days, a far shorter amount of time than the average turn-around of 150 days called for under the fourth device user fee agreement.

More conspicuous to some observers, however, was that the agency had posted those de novos on the same day that Apple unveiled the Apple Watch 4, the platform for the two software devices. Regardless of whether one sees the rapid review as more conspicuous than the synchronized announcements, the combination of the two makes it difficult to ignore the possibility that the entire affair was worked out well in advance.

There are clear indications that the de novos had been in the works for some time prior to the nominal filing dates – indeed, FDA Commissioner Scott Gottlieb tweeted that the agency had “worked closely” with Apple during the two software devices’ developmental phases – but Apple had the smarts to hire a consultant with the regulatory chops to help the company avoid choppy regulatory waters. Donna-Bea Tillman, who at one time was the director of the Office of Device Evaluation at the FDA, served as the lead consultant for these projects on behalf of Biologics Consulting Group in Alexandria, Va.

Conspiracy theorists may ultimately have nothing to dissuade them from their suspicions about the timing of all this, but device makers who hope that this signals a new era of cooperation may be likewise disappointed if they are hoping that this is the new normal at the FDA. There are far too many product releases to allow the agency to regularly coordinate with device makers in this manner, but one of the Apple apps is designed to detect atrial fibrillation, which is strongly associated with sudden cardiac death. The agency’s Sept. 12 announcement not only emphasized the need to encourage development in the digital space, but also to “help millions of users identify health concerns more quickly,” thus suggesting the FDA saw a considerable public health benefit in connection with the grant of these de novos.

Hits and Misses for May 2018

Given the volume of news affecting the life sciences, there are always some favorable outcomes and some that trend in the opposite direction. Following are a few recent developments of note, including one that provided good news for the companies in question, and another that is still unfolding.

Fifth Circuit Blasts Pinnacle Hip Decision

In the area of liability law, the big miss over the past couple of weeks for litigants was the decision by the Fifth Circuit Court of Appeals regarding the Pinnacle hip multi-district litigation. The outcome is of course a significant win for DePuy Orthopedics and its parent, Johnson & Johnson, but the case was remanded to a lower court for reconsideration, and so the device makers are not off the hook just yet.

The court expressed quite a bit of ire over the handling of the case at the trial court, particularly regarding allegations the companies bribed the regime of Saddam Hussein in Iraq, but there were a few issues with paid witnesses that plaintiff’s attorneys had indicated were testifying without compensation. The outcome relieves the companies of a $151 million liability, which was itself a fraction of the $502 million originally arrived at in this case. The principle message to be learned from this outcome is that attorneys for plaintiffs can’t indulge in every whimsical allegation that comes to mind if they want these lawsuits to stay on an even keel.

FDA floats digital precert model

The precertification pilot program for software as a medical device drew raves from stakeholders when the FDA announced the program in September 2017, and the agency has now delivered on a draft working model of a full program. Whether developers see this as a hit or a miss might be conditional on several things, including whether the vendor has prior experience with device applications. The draft states that developers with previous experience in the device business will be subject to less scrutiny, something that information technology companies may see as discriminatory.

The precert concept relies on an organization’s demonstrated commitment to a culture of quality, but the agency said in a statement accompanying the draft working model that such a designation would mean that the organization in question “could potentially submit less information” on the product prior to going to market. The FDA addressed the question of third-party precertification with another response that amounts to “definitely maybe.” This uncertainty also underscored the agency’s remarks regarding whether certified sponsors will be subject to inspections, another conspicuous deviation from the precert pilot.

Opinions vary regarding whether this new paradigm for regulated software is as painless as some believe, given all the optimism surrounding the pilot. One regulatory attorney told a media outlet recently that the FDA document seems an implicit trade of faster times to market in exchange for more regulation. Regulatory attorney Bradley Merrill Thompson of Epstein Becker Green also said, “industry has to review this proposal with eyes wide open.”

In a somewhat related development, the FDA published a draft guidance for multiple function device products, and the Federal Register notice states that the FDA’s Bakul Patel is the contact point for the draft, making clear that this is principally about software devices and software functions that are secondary to the device primary function. Patel is the associate director for digital health at the agency’s device center, hence the authorship makes clear the focus of the draft despite that a device with no software at all could be a multi-function device.

The draft defines the term “function” as “a distinct purpose of the product,” but that distinct purpose could be a mere subset of the intended use or could make up the entire intended use. The most interesting part of the draft, which was made necessary by Section 3060 of the 21st Century Cures Act, is that it states that the “device function-under-review” will be the principle point of interest, although the agency will assess the impact of these other functions on the function under review, even when those other functions would otherwise enjoy enforcement discretion or would not be subject to regulation.

Sponsors will have to conduct a risk analysis of the potential impact of these non-reviewed functions on the function under review, but these non-reviewed functional aspects of the device won’t be subject to post-market surveillance activities. Still, device makers will have to document design considerations for non-reviewed functions, such as software architecture, as well as any relationships between the reviewed and non-reviewed functions, such as shared computational resources.

While the draft may be an improvement on regulatory silence on the matter, it would seem to raise the question of why the entirety of the Quality Systems Regulation is not applicable to a device function that is nonetheless subject to risk analyses and some of the more labor-intensive documentation requirements that fall under the QSR.

Massachusetts Says Brand Name Drug Manufacturers Are Not Liable for Generic Drugs, Except . . .  

Jordan Lipp | Attorney, Managing Member | Childs McCune

On March 16, 2018, the Massachusetts Supreme Court weighed in on the issue of whether a brand name drug manufacturer is liable for a plaintiff’s use of the generic form of the drug, and it reached a surprising result.  As discussed in the previous blog post on December 22, 2017, Conte on Steroids, most states conclude that a brand name drug manufacturer cannot be liable for damages caused by the generic version of the drug.  In a detailed analysis, the Massachusetts Supreme Court followed the vast majority of its sister courts, concluding that a brand name drug manufacturer cannot be held liable in product liability or negligence for a plaintiff who ingested the generic version.

But then, borrowing from case law involving such disparate subjects as landowner duties to trespassers and liability releases for sporting activities, the Massachusetts Supreme Court explained that “public policy is not served if generic drug consumers have no remedy for the failure of a brand-name manufacturer to warn in cases where such failure exceeds ordinary negligence, and rises to the level of recklessness.”  Rafferty v. Merck & Co., No. SJC-12347, 2018 Mass. LEXIS 161, at *29 (Mar. 16, 2018).  As such, the Court found that a brand name drug manufacturer can be liable for the generic version of the drug “where, for instance, a brand-name manufacturer learns that its drug is repeatedly causing death or serious injury, or causes birth defects when used by pregnant mothers, and still fails to warn consumers of this danger.”  Id. at *29-30 (Mar. 16, 2018).

The ramifications of this novel approach are significant.  Setting aside the fact that this decision comes from a court in one of the hubs of innovation in the life sciences, it is important to note that the decision is the very first of its kind.  No other court has determined to bar negligence claims yet permit reckless claims with regards to brand name drug liability resulting from generic use.  The Massachusetts Supreme Court even admits that it is “the only court” to make this distinction.  Id. at *32.

While this is a new issue in the context of drug and device litigation, other types of litigation shed light on what the repercussions of this decision may be.  As referenced above, this distinction of not permitting negligence claims but permitting reckless claims exists in the context of both sporting participants who have signed a release and trespassers who claim injury.  On one hand, the higher standards in these types of cases has discouraged lawsuits and made summary judgment easier for defendants to obtain.  On the other hand, requiring a plaintiff to meet a reckless standard certainly does not eliminate litigation.  And, depending upon the situation and insurance policy, the reckless standard can have serious insurance ramifications as some insurance policies do not cover reckless conduct.  The other question, of course, is whether courts in other jurisdictions may start to follow Massachusetts’ novel approach on brand name drug liability.

Regardless, for brand name drug manufacturers, it is a brave new world in Massachusetts.

Two Tales of Preemption

FDA preemption for medical devices is never out of the spotlight for long, even if the story usually seems unchanged by the latest retelling. One recent case confirms that success is sometimes measured in large part by the adversary’s miscues, but the other seems to break new ground in this area by posing the question of how preemption works when a PMA and a 510(k) device are joined. Perhaps as important, however, is that this second case portends a growing split in the courts on a central point in the preemption debate.

Alphatec Prevails in Sixth Circuit

Some preemption cases are a trial in more ways than one, but Alphatec Spine, Inc. prevailed fairly handily in a hearing of Agee v. Alphatec Spine in the U.S. Court of Appeals for the Sixth Circuit. The district court had dismissed the charges with prejudice despite allowing the plaintiff to amend the complaint, describing the plaintiff’s arguments as “a rambling, disorganized mess,” which consisted primarily of conclusory arguments that came up short of pleading standards under the Federal Rules of Civil Procedure 8 and 9.

The plaintiff seems to have compounded the problem by failing to directly respond to Alphatec’s argument regarding implied preemption during district court proceedings, taking up the subject only from the standpoint of doctrine. The plaintiff attacked express preemption at the district court stage, but Alphatec never raised express preemption. Also apparently unchallenged by the plaintiff was Alphatec’s argument that state law in Ohio bars common-law negligence claims.

The Sixth Circuit allowed the plaintiff to return to the district court to revisit the issue of whether the complaint met federal pleading standards, a move attributed to what is said to have been an abuse of discretion on the part of the district court judge. Nonetheless, the Sixth Circuit made clear it was unimpressed with more or less the entirety of the plaintiff’s handling of the matter, stating that the plaintiff’s failure to challenge the district court’s conclusions regarding preemption “fully determines this appeal inasmuch as the forfeited arguments encompass all of the plaintiffs’ causes of action.”

Preemption, PMAs and Predicate Devices

Express preemption might seem a largely settled matter thanks to Reigel v. Medtronic, but the recently decided case of Shuker v. Smith & Nephew took up the relatively novel predicament of a combination of both PMA and 510(k) devices. The outcome in this case in the U.S. Court of Appeals for the Third Circuit affirmed preemption for PMA devices, but seems to have created a schism with respect to the presumption against express preemption.

Shuker addresses a combination of devices that were not approved by the FDA in the configuration used by the implanting physician, and the plaintiff alleged the company’s literature had violated the law when it discussed the use of Smith & Nephew’s R3 acetabular cup in this configuration. The court received an amicus brief from the Department of Justice, which affirmed preemption for PMA devices even when attached to one or more 510(k) devices, but the Third Circuit seems to have sustained the possibility that Smith & Nephew’s printed material regarding the R3 could support a claim of misrepresentation. The Third Circuit sent that discussion back to the district court, which had dismissed that claim with prejudice.

While Shuker is a win for preemption, this appears to be the first instance in which an appeals court has undertaken the question of a device system bearing both 510(k) and PMA components. There is a novel source of tension in the decision, however, in that the court declared that the presumption against express preemption is still alive. The U.S. Court of Appeals for the Eight Circuit arrived at a different conclusion last year in Accord Watson v. Air Methods Corp., but the outcome in Shuker is based in part on the notion that what some believe is pertinent a Supreme Court precedent – that of Puerto Rico v. Franklin California Tax-Free Trust – is not applicable to the areas of the economy regulated by the FDA because Puerto Rico v. Franklin was directed toward bankruptcy law.

Consequently, the Third Circuit argued that the presumption against federal preemption is still a functioning legal theory, but attorneys for Medtronic might differ. The company won a case in the Arizona Supreme Court in October 2017, Conklin v. Medtronic, in which Judge Lori Bustamante declared that even though federal laws are not typically presumed to preempt state laws, the courts “do not invoke that presumption when the federal statute contains an express preemption clause.” Bustamante cited Puerto Rico v. Franklin in support of that conclusion.

It is predictably difficult to forecast how the presumption dilemma will unfold if only because a device maker will have to suffer an adverse outcome in a circuit court before the question is brought to the Supreme Court. On the other hand, there is clearly a growing trend toward differential outcomes on this point, which at the very least suggests the Supreme Court may find this a compelling problem should a device maker apply for cert.