Court: FDA Approval Preempts State False Advertising Laws

August 29, 2007

In a precedential opinion, a U.S. Court of Appeals for the 3rd Circuit judge has upheld a lower court’s ruling that drug advertising based on FDA-approved drug labeling is exempt from state false advertising laws.

Circuit Court Judge D. Brooks Smith ruled earlier this month to uphold the dismissal of a class action suit in which a group of consumers sued AstraZeneca for engaging in deceptive conduct in its advertising of Nexium (esomeprazole magnesium).

The plaintiffs alleged AstraZeneca’s marketing for Nexium was deceptive because it claimed the drug was superior to Prilosec (omeprazole magnesium), the company’s older proton-pump inhibitor for treating acid reflux and heartburn, according to Smith’s opinion. The group had filed suit in 2005 in the U.S. District Court for the District of Delaware.

The plaintiffs alleged that the company aggressively marketed Nexium, which was approved in 2001, because Prilosec was about to go off patent. According to the complaint, AstraZeneca violated the Delaware Consumer Fraud Act and consumer protections in all 50 states. The Delaware court dismissed the complaint with prejudice, Smith wrote.

In the appeal, the circuit court considered, for one, whether state consumer fraud laws “dictate the parameters of false and misleading advertising in the prescription drug context,” Smith wrote.

Because the Nexium advertising was based on the drug’s FDA-approved labeling, the district court had decided that FDA regulatory authority and congressional intent in the Federal Food, Drug and Cosmetic Act preempted state law, and Smith affirmed the judgment.

“To allow generalized state consumer fraud laws to dictate the parameters of false and misleading advertising in the prescription drug context would pose an undue obstacle to both Congress’ and the FDA’s objectives in protecting the nation’s prescription drug users,” Smith wrote. “Accordingly, the state consumer fraud laws are preempted by the extensive federal legislative and regulatory framework.”

In his dissenting opinion, Judge Robert Cowen pointed out that the plaintiffs were not questioning Nexium’s labeling, but rather AstraZeneca’s methods of advertising, and that “there is no risk that a successful state law claim, alleging that Nexium advertisements contain false and misleading drug comparisons, would conflict with the FDA’s approval of the statements in the Nexium labeling.”

The full opinion is available at www.ca3.uscourts.gov/opinarch/055340p.pdf. — Breda Lund