United States District Court for the District of Massachusetts, Decision of 29 November 2012, No. 12-11386-RGS, Genzyme Corp. v. Shire Human Genetic Therapies, Inc.
A press release reporting the results of scientific research concerning competing drug therapies was found to constitute commercial advertising regulated under the Lanham Act.
Genzyme, a subsidiary of Sanofi SA, is a Massachusetts biotechnology company that focuses on treatments for rare genetic disorders, including Gaucher disease. Symptoms of Gaucher disease include reduced bone mineral density, bone thinning, and weakened bones that are easily fractured. In 1994, Genzyme received approval from the U.S. Food and Drug Administration (FDA) to manufacture and sell a drug called Cerezyme , a long-term enzyme replacement therapy for patients with Type 1, the most common of the three types of Gaucher disease.
Shire Human Genetic Therapies, Inc. (Shire) is a competitor of Genzyme in the specialty biopharmaceutical market serving the Gaucher community. Shire manufactures and sells a long-term enzyme replacement therapy for Gaucher disease called VPRIV. Genzyme’s Cerezyme and Shire’s VPRIV are the major players in the Gaucher disease enzyme replacement therapy market.
In June 2012, Shire issued a press release in which it made superiority claims for VPRIV based on what it described as a "head-to-head trial between VPRIV and Cerezyme." Shire posted the press release on its main website page under the headline “latest News” and also furnished it to a news distribution service, PR Newswire, for dissemination to media outlets throughout the United States. Shire also sent the press release to a patient organization focusing on the Gaucher community, the National Gaucher Foundation, viewed as a leading information source for Gaucher patients.
Genzyme sued Shire in federal court in Boston, Massachusetts, charging that the press release makes several false and/or misleading claims about VPRIV, including the false message that VPRIV provides better improvement in spine mineral density than the rival Cerezyme.
Shire moved to dismiss Genzyme’s complaint, arguing that the press release merely reported the presentation of clinical trial research at the European Working Group on Gaucher Disease, a scientific meeting held in Paris in June 2012. Shire argued that a press release reporting the results of scientific research is not commercial advertising subject to scrutiny under the Lanham Act but instead is scientific expression protected under the First Amendment, even when the entity doing the reporting has an economic interest in the speech.
Genzyme acknowledged that reporting the results of scientific research is protected by the First Amendment but argued that its secondary dissemination can constitute commercial speech if done for commercial purposes.
Judge Stearns observed that, in order to qualify as a commercial advertisement, a representation must (a) constitute commercial speech (b) made with the intent of influencing potential customers to purchase the speaker’s goods or services (c) by a speaker who is a competitor of the plaintiff in some line of trade or commerce and (d) disseminated to the consuming public in such a way as to constitute advertising or promotion. He specifically noted that "[t]he peculiarities of the prescription drug industry make dissemination of scientific research results an especially important and prevalent marketing tool."
Judge Stearns went on to conclude that while Shire’s original presentation of comparative data at the European Working Group convocation was protected scientific expression, its secondary dissemination was not. The press release itself was not a scientific publication. It directly named VPRIV and Cerezyme, the two principal competitors in the Gaucher disease enzyme replacement therapy market, and it listed Shire’s stock symbols on its first line.
The press release also selectively disseminated information favorable to Shire’s VPRIV and unflattering to Cerezyme to an audience that included both physicians who prescribe Gaucher disease treatments and patients who might request a specific treatment. Under the circumstances, Judge Stearns held, "Shire[ ]’s press release may be deemed commercial speech."
Whenever a company finds that a competitor is making materially false claims regarding a product or service, a Lanham Act false advertising suit should be considered, particularly in the case of prescription and over-the-counter drug advertising.