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Off-Label Marketing and the False Claims Act

In a post published earlier this week this week our colleagues Brian Dunphy and Joanne Hawana examined key issues in the recent Amarin decision from the Southern District Court of the New York. The August 7th ruling provided Amarin Pharma, Inc. with a preliminary injunction that blocks FDA from bringing a misbranding action against the company when making truthful statements to physicians regarding off-label uses of the drug Vascepa® (icosapent ethyl).

In addition to giving rise to potential misbranding charges under the Food, Drug, and Cosmetics Act, off-label marketing can give rise to False Claims Act (FCA) lawsuits and has resulted in many sizeable settlements. The basis for FCA cases involving off-label marketing is not that the marketing or prescribing of drugs paid for by federal health care programs for off-label uses is outright illegal, but rather that misleading marketing causes the prescriber to mistakenly believe that the drug is effective for off-label use and that the FDA has approved it for such off-label use. Off-label marketing causes a “false” claim to be made to the federal government when the physician prescribes a drug based on misleading marketing material, which is then paid for by a federal health care program, and the physician would not have prescribed the drug if he or she had known that the drug was not in fact FDA-approved or clinically proven to be effective for the off-label use.

As we previously discussed after the Caronia ruling, we do not expect the Amarin decision to have much bearing on FCA cases based on off-label marketing. The Amarin case focused on the company’s ability to make truthful statements about the drug’s effectiveness and FDA approval status; the decision does not touch on drug manufacturers’ liability for using false or misleading off-label promotion.  Thus Amarin, like Caronia, will not likely affect the potential for drug manufacturers’ FCA liability.  And although Amarin argued for an injunction against the government from prosecuting it under the FCA as well, the court found that second pre-enforcement challenge not yet ripe as a “controversy” for purposes of federal court jurisdiction.

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