The U.S. Food and Drug Administration announced last week a proposed major change to its regulations governing the labeling of generic drugs, which represent more than 80% of the drugs prescribed to patients in the United States. The proposed rule, which was published in the Federal Register on November 13, 2013,1 would remove the existing restrictions that prohibit generic drug manufacturers from making safety-related changes to their labeling until the brand name manufacturer does so. If finally adopted by the FDA, the rule would permit generic manufacturers to make so-called “changes being effected” (CBE) revisions to their labels while the FDA considers the proposed change.
This proposed rule could have a profound effect on the potential liability of generic manufacturers in failure-to-warn and design defect cases. As a result of two United States Supreme Court decisions in the last three years,2 generic manufacturers had been largely protected from those kinds of lawsuits. If the proposed rule is put into effect by the FDA following the rule-making process,3 a generic manufacturer would no longer have the ability to assert as a defense that it lacked the unilateral ability to alter the information contained in its product’s labeling after becoming aware of safety concerns.
Under existing FDA regulations, to be approved for marketing, a generic version of an existing brand-name drug must be identical to the branded product in several important ways. It must be chemically equivalent (containing the same active ingredients, for example), it must be bioequivalent (possessing the same rate and extent of absorption as the branded product) and the labeling for a generic drug must be the same as the labeling approved for the branded drug.4 Once a generic manufacturer’s drug labeling has been approved as being the same as the branded manufacturer’s, the generic manufacturer is prohibited from making any unilateral changes to the label. Indeed, the FDA may withdraw approval for the generic drug if its label is no longer consistent with the label for the branded product.5
Based on this rule, the United States Supreme Court found in two recent cases6 that plaintiffs who were allegedly injured as a result of their use of generic drugs could not assert state common law product liability claims against the manufacturers of those drugs that were grounded upon the claimed inadequacy of the safety warnings contained in the product labeling. The Court found in each case that, under federal law and the FDA’s regulatory scheme for generic drugs, the generic manufacturers had no control over the labeling of their products and therefore could not be held accountable for alleged inadequacies in those labels.
The FDA took the position in PLIVA that the warning labels of a brand-name drug and its generic copy must always be the same.7 The agency asserted, however, that a generic manufacturer which determined that changes were required to strengthen the warnings contained in its labeling had the right — if not the duty — to propose those changes to the FDA itself. If the FDA agreed that a label change was necessary, it would arrange with the brand-name manufacturer to change its label, thus enabling (actually, requiring) the generic manufacturer to do likewise.
In an amicus brief it filed with the Supreme Court in the Bartlett case, the FDA hinted that it was considering a proposed rule that would permit generic manufacturers to initiate labeling changes, even before changes were made to the label of the branded equivalent drug.
The FDA’s proposed new rule would permit generic manufacturers to update their product labeling promptly to reflect important safety-related information, regardless of whether the new labeling is the same as the labeling carried by the branded equivalent drugs. At the same time that it makes the change to its labeling, the generic manufacturer would be required to send notice of the proposed labeling change to both the FDA and the brand-name manufacturer by means of a “changes being effected” supplement to its labeling that includes all information on which the generic manufacturer based its decision to revise its labeling. The agency would then review the data presented in support of the proposed labeling changes, and discuss the proposed changes with the branded manufacturer and the manufacturers of any other generic versions of the product. If the FDA thereafter approves the proposed change (or some other modification), it will require all manufacturers to conform their labeling. If the FDA rejects the proposed change, it will demand that the generic manufacturer revert to the original labeling.
The FDA’s notice of its proposed rule makes express reference to the Supreme Court’s preemption decisions and states that the proposal is intended to “create parity” between branded and generic drug manufacturers with respect to their obligations to submit CBE labeling changes based on newlyacquired information. While generic manufacturers previously enjoyed something of a safe harbor entitling them to sit on the sidelines if their labeling was the same as the branded manufacturer’s, the FDA acknowledges in its notice of the proposed rule that if the rule is finally adopted, “it may eliminate the preemption of certain failure-to-warn claims with respect to generic drugs.”8
Proponents of the proposed rule, including the FDA, urge that the FDA’s proposal is intended provide incentive to generic drug companies to actively participate with the FDA in ensuring the timeliness, accuracy and completeness of drug safety labeling. The FDA argues that a more streamlined process for updating safety information benefits manufacturers and consumers alike.9 Consumers might support the proposed rule, as well, since it would appear to permit injured consumers of generic products to pursue claims based on failure-to-warn and design defect theories of liability that were cut off by Supreme Court decisions.
It can be expected that there will be some who will oppose the proposed rule as extending beyond the agency’s power to enact, arguing that it is antithetical to the entire premise of the Hatch-Waxman Act, which allows manufacturers to develop generic drugs inexpensively without performing expensive and time-consuming clinical trials and studies. Others may argue that the proposed rule will sow confusion, especially in situations where there are multiple generic manufacturers of a popular drug product. Each of those manufacturers could propose its own CBE supplement, with the result that different versions of the same product could each carry a different safety warning for a period of time until the FDA can harmonize them into one warning. In that case, far from complying with federal law requiring equivalent branded and generic products to share the same label, each version of the same product could carry a different label for a period of time.
The pharmaceutical industry (both branded and generic), consumers and the product liability bar will be watching carefully as the FDA’s rulemaking process unfolds. It is inevitable that any change in the current rule will be tested in the courts.
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2 See PLIVA, Inc. v. Mensing, 564 U.S. ___, 131 S. Ct. 2567 (2011) (holding that failure-to-warn claims against generic manufacturers are preempted by the federal law’s prohibition on unilateral changes to generic drug labels) and Mutual Pharmaceutical Co., Inc. v. Bartlett, ___ U.S. ___, 133 S. Ct. 2466 (2013) (holding that state law design-defect claims that turn on the adequacy of a drug’s warnings are preempted by federal law).
3 The FDA’s notice requires electronic or written comments on its proposed rule to be submitted by January 12, 2014. Any final rule adopted by the agency will become effective 30 days after the date of its publication in the Federal Register.
4 See 21 U.S.C. § 355(j)(2)(A).
5 See 21 CFR §§ 314.94(a)(8)(iii) and 314.150(b)(10).
6 See n.2, supra.
7 See PLIVA 564 U.S. ___ at ___, 131 S. Ct. at 2575 (“The [FDA] interprets the CBE regulation to allow changes to generic drug labels only when a generic drug manufacturer changes its label to match an updated brand-name label or to follow the FDA’s instructions.”).
8 See http://federalregister.gov/a/2013-26799 (FDA Notice [Docket No. FDA-2013-N-0500]) at 16-17.
9 J. Woodcock, M.D., “Working to improve the communication of important drug safety information about generic drugs,” FDA Voice (Nov. 8, 2013) (accessed at https://blogs.fda.gov/).
This article was originally published by Bingham McCutchen LLP.