Second Circuit Rules Off-Label Prosecution Violates First Amendment

by Michael Volkov
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The US Court of Appeals for the Second Circuit, in a decision issued on December 3, 2012, in United States v. Caronia, threw out a criminal conviction of the defendant Alfred Caronia, a pharmaceutical sales person, for an off-label marketing violation, ruling that the prosecution violated the First Amendment.  (A copy of the decision is here).

The Caronia Court ruled in a 2-1 decision that the prosecution violated Caronia’s First Amendment rights.  Caronia was convicted of “misbranding” under 21 U.S.C. § 331(a) and (a)(1) for off-label promotion of Xyrem, commonly known as a “date rape drug.”  The defendant claimed that the off-label promotion was accurate and was protected as “commercial speech” under the First Amendment. 

At trial, the government introduced recorded statements made by Caronia to a cooperating individual promoting off-label uses of Xyrem.  The government claimed that the defendant’s speech was only used to establish criminal intent.  The Second Circuit rejected this argument, finding that the criminal conviction rested solely on the defendant’s speech.  The Court also noted that the FDA statute and regulations do not directly criminalize off-label promotion but cited the government’s claim that such promotion constitutes “misbranding” of a drug under 21 U.S.C. § 331(a) and (a)(1).

The Second Circuit’s decision was expected given the Supreme Court’s decision in  Sorrell v. IMS Health, 131 S. Ct. 2653 (2011), in which the Court reversed Vermont regulations prohibiting pharmaceutical companies from using prescriber-identifying information for marketing purposes.  In Sorrell, the Supreme Court stated that “ [s]peech in aid of pharmaceutical marketing . . . is a form of expression protected by the . . . First Amendment.  Id. at 2659. 

In reversing Caronia’s conviction, the Second Circuit applied a “heightened scrutiny” standard and found that the regulations were not narrowly tailored to the government’s interest in promoting drug safety and the FDA approval system.  The Caronia Court cited several less restrictive measures which could have been applied to promote the government’s interest, such as warnings to doctors of off-label uses, which would not implicate First Amendment rights. 

The Caronia decision, if upheld, will have a significant impact on the Justice Department’s off-label marketing prosecution program.  The government is expected to seek rehearing on the panel’s decision, and it is likely that its rehearing petition will be granted. 

For now, the Second Circuit’s decision is the law in that circuit and could result in other defendants raising similar defenses in other court cases.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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