Tuesday, May 1, 2012
Summary in DOJ's Reply Brief in Franck's
Here is the introduction and summary from the government's reply brief in Franck's:
INTRODUCTION AND SUMMARY
Like the definition of "new drug" for human use, the definition of "new animal drug" in the Federal Food, Drug, and Cosmetic Act ("FDCA" or "the Act") is sweeping and straightforward – "any drug intended for use for animals other than man" that "is not generally recognized * * * as safe and effective under the conditions prescribed." 21 U.S.C. § 321(v)(1) (emphasis added); compare id. § 321(p)(1) ("new drug" definition). When a pharmacy compounds a drug for animal use, it creates a Case: 11-15350 Date Filed: 05/01/2012 "new animal drug" because the compounded product is not generally recognized by experts as safe and effective, and it has not been subjected to the controlled clinical trials that are necessary to establish its safety and effectiveness. Even a drug that is a copy of an approved animal drug is a "new animal drug" that must be independently established as safe and effective when produced by a party other than the one that holds FDA approval for the drug. Although Congress has carved out a few exceptions to the "new animal drug" definition and the FDCA's approval and other requirements for such drugs, it has enacted no unconditional exemption for new animal drugs compounded by pharmacies.
Thus, the consistent position of the Food and Drug Administration ("FDA" or "the agency") – based on the Act's plain language and documented in litigation, FDA's Compliance Policy Guides ("CPG"), and regulations – has been that pharmacy-compounded drugs for human and animal use are "new drugs" and "new animal drugs" that require FDA approval before they can be lawfully distributed in interstate commerce. At the same time, however, FDA recognizes that drug compounding is part of traditional pharmacy practice, and, when compounded pursuant to valid prescriptions for individual patients, compounded drugs can serve important public health purposes by meeting the needs of patients for whom approved, commercially available drugs are inadequate. For that reason, FDA has 2 Case: 11-15350 Date Filed: 05/01/2012 historically declined, and continues to decline, to take enforcement action against pharmacies engaged in traditional compounding activities. However, when evidence shows (as in this case) that a pharmacy's activities substantially exceed the bounds of traditional compounding, and the pharmacy is effectively engaged in drug manufacturing masquerading as compounding, without compliance with FDCA approval and other requirements, the agency takes enforcement action.
Three other circuits have squarely held that pharmacy-compounded animal drugs are "new animal drugs" under the Act and are therefore subject to FDA's enforcement authority. Med. Ctr. Pharmacy v. Mukasey, 536 F.3d 383, 408 (5th Cir. 2008) ("Medical Center"); United States v. Algon Chem. Inc., 879 F.2d 1154, 1158, 1160 (3d Cir. 1989); United States v. 9/1 Kg. Containers, 854 F.2d 173, 179 (7th Cir. 1988), cert. denied, 489 U.S. 1010, 109 S. Ct. 1118 (1989). No circuit has held otherwise. Moreover, the Supreme Court has discussed approvingly FDA's enforcement policy and affirmed that "the Government needs to be able to draw a line between small-scale compounding and large-scale drug manufacturing." Thompson v. W. States Med. Ctr., 535 U.S. 357, 361-63, 370, 122 S. Ct. 1497, 1501-02, 1505 (2002) ("Western States").
This appeal presents the same fundamental question of law answered by the courts in Medical Center, Algon, and 9/1 Kg. That question arises in the context of 3 Case: 11-15350 Date Filed: 05/01/2012 a rare civil enforcement action initiated by FDA against a pharmacy whose compounding activities have demonstrably exceeded the bounds of traditional pharmacy practice and resemble large-scale drug manufacturing. The undisputed record supporting FDA's request for injunctive relief (largely overlooked by the district court) shows that the animal drug compounding activities of Franck's Lab – as its name, extensive product catalog, operations, and documented history of FDCA violations over several years suggest – is more indicative of a manufacturer than the corner drugstore that compounds a lifesaving medication for the family dog pursuant to a veterinarian's individualized prescription.
Thus, this case is not about whether traditional pharmacy compounding can serve important public health purposes; it can and does. This appeal concerns whether Congress has authorized FDA to take enforcement action against pharmacies when their compounding activities pose a threat to public health because they are manufacturing drugs, but evading the FDCA's approval and other requirements that Congress enacted to protect public health.
Franck's Lab acknowledges, as it did in district court, that FDA has authority to take enforcement action against entities engaged in unlawful drug manufacturing, but it fails to identify the source of that authority and to explain where the "line between small-scale compounding and large-scale drug manufacturing" lies. Western 4 Case: 11-15350 Date Filed: 05/01/2012 States, 535 U.S. at 370, 122 S. Ct. at 1505. Those failures are fatal to Franck's Franck's Lab and its amici grossly misrepresent FDA's position (see, e.g., Franck's Br. 10), characterizing it as extreme, when, in fact, this action represents a judicious exercise of the agency's enforcement authority against a pharmacy that has repeatedly flouted the law and FDA warnings.
Franck's Lab and its amici contend that FDA has changed its policy and has acted inconsistently. Not so; the agency's position here is fully consistent with the position that it has repeatedly taken in other litigation over many decades and that is set forth in FDA's publicly available enforcement guidance. Franck's Lab claims that the federal government's action here clashes with sovereign State interests, but, notably, Franck's Lab has not, and cannot, identify any such tension. Finally, Franck's claim that the government has conceded or waived certain arguments is baseless.