In early June, the Northern District of California ruled on a motion presented by Scott Harkonen, former CEO of InterMune, Inc., seeking to limit evidence in his upcoming criminal trial or, alternatively, to dismiss the indictment against him. In a sweeping opinion, the Court ruled decisively that press releases are “labeling” within the meaning of the Food, Drug, and Cosmetic Act (FDCA), and rejected Harkonen’s arguments that his actions fell within the U.S. Food and Drug Administration’s (FDA’s) safe harbor for “scientific exchange” or, alternatively, were protected by the First Amendment. As a result, he will face a jury in July on the government’s allegations that he disseminated information (including a press release) about InterMune’s Actimmune® (interferon gamma-1b) with the intent to defraud or mislead.

Companies should carefully evaluate their processes and criteria for review of press releases to ensure that the companies are properly distinguishing press releases that are promotional labeling from those that constitute scientific exchange. When they qualify as promotional labeling, a number of regulatory issues must be addressed.

The Facts

As the CEO of InterMune, W. Scott Harkonen presided over a company that sold Actimmune® — a drug approved in two narrow orphan indications. After a 1999 publication reported positive results of a phase II study of the drug in which patients with lung fibrosis improved, InterMune began a phase III study of Actimmune® in idiopathic pulmonary fibrosis (IPF). The company received reports that the trial failed in August 2002, but Harkonen instructed company staff to conduct posthoc subset analyses of the data, one of which suggested a survival trend for patients suffering from mild to moderate IPF. InterMune presented the data to the FDA but the agency notified the company that they were insufficient to support an indication and that further testing would be required.

Regardless, on August 28, 2002, InterMune issued a press release announcing the phase III study results, with the title “InterMune announces Phase III Data Demonstrating Survival Benefit of Actimmune® in IPF.” The indictment alleges that Harkonen himself drafted the release’s title and controlled the content of the entire press release. The firm, with Harkonen’s approval, hired a marketing firm to determine whether the press release would affect pulmonologists’ willingness to prescribe the drug. The press release was sent to all company sales representatives, faxed to over 2,000 pulmonologists, and sent by a specialty pharmacy to Actimmune® patients along with their medications. The government alleges that this conduct amounts to federal wire fraud and intentional misbranding.

The Court’s Opinion

Harkonen sought to limit introduction of the press release under two theories — that it did not constitute “labeling” sufficient to misbrand Actimmune® or that it was protected under the FDA’s safe harbor for “scientific exchange” or, alternatively, the First Amendment.

The Press Release Is Labeling

The Court fairly succinctly rejected Harkonen’s assertion that the press release did not constitute labeling for Actimmune®. His argument rested on an assertion that the press release and InterMune’s related communications about Actimmune® did not “supplement or explain” the drug product and did not form an “integrated distribution program” surrounding the drug. The Court, relying on Kordel v. United States,1 found the issue

relatively straightforward … the communications need not transmit all details about dosages and methods of administration so as to usurp the role of the ‘directions for use’ component of the drug label itself. The test is whether the drug product and the information or communications are ‘interdependent.’ Here, the communications as alleged promote the use of a product (Actimmune®) for a specific, unapproved indication (patients with mild to moderate IPF) with supplemental or explanatory guidance for its usefulness (to be used early in the course of treatment).

Moreover, based on the expansive construction of “labeling” under the FDCA, there was never any ambiguity that issuing a press release could form the basis of a misbranding charge.

Both the FDA regulations and the case law make clear that labeling under the FDCA is construed expansively, such that it may encompass nearly every form of promotional activity, including package inserts, pamphlets, mailing pieces, fax bulletins, reprints of press releases, and all other literature that supplements, explains, or is otherwise textually related to the product. …

This is the case despite the fact that FDA’s safe harbor for “scientific exchange” allows for the dissemination of scientific findings in the media. Thus, Mr. Harkonen has not been denied fair notice sufficient to require dismissal of the indictment.

The First Amendment

Mr. Harkonen also alleged that the materials at issue, including the press release, constitute scientific opinions that are entitled to First Amendment protections as pure scientific speech or as commercial speech that is inextricably intertwined with scientific speech. The government responded that the First Amendment does not protect against fraud and the nature of the allegations against Harkonen were fraud claims which must be adjudicated by a jury.

The court made clear that is was important to determine whether the alleged speech was wholly protected. But, after doing so, it had little difficulty agreeing with the government. The court evaluated the facts alleged by the prosecution — that the speech at issue was a press release rather than a peer reviewed publication, that it referred to a commercial product and that it was “unquestionably disseminated for commercial benefit.” Thus, the speech was not “pure scientific speech” and was subject to the traditional commercial speech analysis. Indeed, the “press release and associated speech incorporates, reformats, and post hoc reinterprets scientific results. …” Because the indictment alleges that Mr. Harkonen made “knowingly false and misleading statements in” publishing the press release, the case should proceed to a jury. Moreover,

It is undisputed that the government has the right to regulate false and misleading statements made to doctors and patients about drug products in interstate commerce. … [Thus] the speech at issue is not outside the bounds of the FDCA’s regulatory reach. …

Finally, this opinion joins several recent decisions that rejected defendants’ attempts to shield allegedly improper conduct from prosecution through use of the First Amendment. In Caputo,2 Caronia,3 and now Harkonen, courts have uniformly rejected those efforts, instead agreeing with the FDA that the fraudulent or misleading nature of the actions at issue should proceed to a jury for adjudication. Consequently, companies should be mindful of the limitations of a First Amendment defense when crafting company policies and making decisions about disseminating information about drug products.

Scientific Exchange

Although the scientific exchange safe harbor has been part of the FDA’s regulations for decades (21 CFR 312.7), we are unaware of any previous judicial analysis of its scope. As a result, this opinion lays new ground in the legal framework of scientific exchange by pharmaceutical companies. Harkonen argued that the provisions in 21 CR 312.7 which prohibit off-label promotion but allow “… the full exchange of scientific information concerning the drug, including dissemination of scientific findings in scientific or lay media,” constitute a safe harbor for press releases containing scientific information. The Court soundly rejected his argument. The Court concluded that a press release that constitutes “promotion” is not covered by this provision. The Court notes that Harkonen was not indicted for “… disseminating or exchanging scientific information in and of itself, but rather with disseminating information regarding Actimmune® for the treatment of IPH with the intent to defraud or mislead.”

Nothing in the Court’s decision undercuts the ability of a company to issue a press release detailing scientific data about a product and thereby engaging in “scientific exchange.” Such press releases, properly written and used so as not to be promotional, remain lawful.

Importantly, companies should evaluate internal policies to ensure that press releases announcing clinical data are carefully evaluated to ensure that they are not treated as promotional labeling either in content or in the way they are used. If deemed promotional labeling, this raises a series of complex regulatory questions surrounding filing press releases with FDA on first use, inclusion of the full prescribing information, and fair balance.