FDA Message to Pharma: Misdemeanor Criminal Charges can Result from Promoting Off-Label Drug Uses

Oct 14, 2010   

The FDA should target for misdemeanor criminal prosecution the executives of pharmaceutical companies which promote unauthorized uses of their medicines.

This is the latest message from Eric Blumberg, Deputy Chief for Litigation for the U.S. Food and Drug Administration. Speaking at the “Enforcement and Litigation Conference” for the Food and Drug Law Institute on October 13, 2010, Blumberg said, “Unless the government shows more resolve to criminally charge individuals at all levels in the company, we cannot expect to make progress in deterring off-label promotion.”

Blumberg cited a recent case involving Pfizer in which the company agreed to pay a $2.3 billion fine for the off-label marketing of several products. Some industry analysts point to the Pfizer case as evidence that big pharma increasingly sees FDA fines and settlement agreements referencing “corporate integrity” as nothing more than a cost of doing business, and not changing industry practices. “Its clear were not getting the job done with large, monetary settlements,” Blumberg added.

This is not the first time Blumberg “ and the FDA “ has talked about getting tough with criminal prosecutions for drug law violations.

Not long after his appointment as the FDAs top litigator in 2005, Blumberg stated that senior executives should be held accountable for company actions under Federal Food, Drug and Cosmetic Act (FD&C Act). He warned that ignorance is not bliss, and also is not a defense in court. “The FD&C Act is a strict liability statute,” Blumberg said to a conference of pharmaceutical companies. “That means you may be found criminally responsible for a violation of the FD&C Act, even though you did not participate in the violation, you were not aware of the violation, or you did not act with criminal intent, or even negligence.”

Blumbergs words echo the so-called Park Doctrine, named after the Supreme Court decision in United States v. Park, 421 U.S. 658 (1975). This doctrine allows the government to seek criminal convictions against company officials for alleged violations of the FD&C Act.

In that case, the conviction of John Park, President of a national retail food chain, was upheld by the Supreme Court. The Court ruled that senior executives of companies manufacturing or selling FDA-regulated products have an affirmative duty to ensure the safety of those products. The Court further held that the U.S. Government can criminally prosecute corporate officers who are in a “responsible relationship” to an illegal activity by a company even if the person did not take part in, or even know of, the companys activities. The FD&C Act, according to the Court, imposes a positive duty on senior company officers to seek out and remedy violations when they occur as well as implement processes to prevent violations in the first place.

The Doctrine was used extensively by the FDA in the 1970s in strict liability cases usually involving “dirty warehouses” “ unsanitary facilities maintained by a company. But by the early 1980s, use of the Park Doctrine in criminal prosecutions had fallen off, due in part perhaps, to the meager penalties for misdemeanor convictions, which often were as low as $50.

Then in 2008, the U.S. Sentencing Commission adopted new guidelines that increased the likelihood that misdemeanor convictions under the Doctrine will result in prison time. These changes, along with higher penalties and the passage of new laws increasing the FDAs enforcement authorities and postures seem to have resurrected use of the Park Doctrine.

While Blumberg stated yesterday that his comments did not reflect FDA policy, they do reflect the thinking of the agencys senior management. In a March 2010 letter from FDA Administrator Margaret Hamburg to the Senate Finance Committee, Hamburg also stated that the FDA plans to increase misdemeanor prosecutions of pharma industry executives as it refocuses its Office of Criminal Investigations on stricter enforcement measures.

Blumberg added yesterday that pharmaceutical company officials shouldnt wait until they are criminally charged to begin bringing their marketing campaigns into compliance with FDA regulations. “If youre a corporate executive or are advising a corporate executive, now is the time to comply,” he said. “That conduct may already be under the criminal microscope.”

And quite a microscope it is. Under current law, misdemeanor cases carry sentences for company execs of up to a year in prison and/or a maximum fine of $100,000 per count. If the crime results in death, however, the maximum fine for an individual is $250,000. The FDA also can bar individuals from working in the industry.