On December 3, 2012, the United States Court of Appeals for the Second Circuit ruled that a pharmaceutical sales representative could not be convicted for truthful off-label promotional statements made to physicians about a drug that had been approved by the FDA for other uses.  United States v. Caronia, 09-5006-cr  (2d Cir. Dec. 3, 2012). 

Caronia was a sales representative who promoted Xyrem, a drug that was approved for two specific uses and carried a “black box warning.”  Caronia detailed physicians who might prescribe the product and helped establish a speakers program where the drug was discussed.   During the course of a government investigation, Cardonia was recorded promoting the drug for unapproved uses, including unapproved indications and unapproved subpopulations.  The government did not allege that the statements at issue were untruthful or misleading. 

Caronia was convicted in the trial court for conspiracy to introduce or deliver misbranded drugs into interstate commerce, in violation of the Food, Drug and Cosmetic Act (FDCA).  The Second Circuit vacated this conviction.  The government, according to the court, incorrectly argued that off-label promotion alone constitutes “misbranding.”  The court found that the FDCA does not expressly prohibit the promotion of drugs for off-label use, but noted that promotional statements could constitute proof of an intent to use a drug in a manner that the FDA had not approved and was inconsistent with the label, which would be actionable under the FDCA. 

The court concluded that the government prosecuted Caronia not for his intent to sell misbranded drugs based on his statements regarding the drug’s off-label uses, which does not implicate the First Amendment, but rather for the act alone of making statements about off-label uses for the drug, which does implicate the First Amendment.  The court held that the First Amendment protects this type of commercial speech and that the government could not overcome the heightened scrutiny applicable to such commercial speech.  The court looked to the United States Supreme Court’s recent decision, Sorrell v. IMS Health, in which the Court held that “[s]peech in aid of pharmaceutical marketing . . . is a form of expression protected by the Free Speech Clause of the First Amendment."  131 S. Ct. 2653, 2659 (2011).  

In reaching its decision, the Second Circuit reasoned that the statements were truthful; the FDCA does not expressly prohibit the promotion of drugs for off-label use; physicians are permitted to prescribe the drug for unapproved uses, and persons other than pharmaceutical companies and their sales representatives may advise physicians of off-label uses of drugs that the FDA had approved for other uses.  The court interpreted the misbranding provisions of the FDCA as “not prohibiting and criminalizing the truthful off-label promotion of FDA-approved prescription drugs” and concluded that “the government cannot prosecute pharmaceutical manufacturers and their representatives under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug.” 

The court noted that its decision was limited to FDA-approved drugs for which off-labels uses are permitted and that the FDA is authorized to regulate prescription drug marketing.  In addition, the court made clear that off-label promotion that is false or misleading is not protected by the First Amendment. 

One of the three judges on the panel dissented from the decision and issued a lengthy opinion arguing that Caronia’s conviction should have been upheld.  In this dissent, the court disagreed with the majority’s interpretation of the government’s position and contended that Caronia was prosecuted because his speech revealed an intent to sell the drug for a use that was inconsistent with the drug’s label, not for the speech itself.  As such, the court noted, the First Amendment did not apply and did not protect Caronia’s statements.  Even if the First Amendment did apply, the dissent stated, the FDCA’s misbranding provision precludes promotion of off-label uses and passes constitutional muster.  The dissent argued that the majority opinion serves as a disincentive to pharmaceutical manufacturers to go through the premarket drug approval process and undercuts the purpose of the FDCA and the FDA to ensure the safety and efficacy of drugs before they are marketed.   

The Caronia decision is not binding on trial courts outside of the Second Circuit and likely is not the last word on this subject.  We anticipate a request for further review by the full panel of the Second Circuit or review by the United States Supreme Court.  Until the United States Supreme Court reviews the decision, off-label promotion is subject to prosecution outside of the Second Circuit.  In addition, both in and out of the Second Circuit, off-label promotion by sales representatives remains potentially actionable because, among other things, the government could argue that it is evidence of an intent to sell a misbranded drug.

Full Text of Decision: United States v. Caronia, 09-5006-cr  (2d Cir. Dec. 3, 2012)