FDA/McNeil Consent Decree Highlights Increased Government Efforts At Regulating Drug Recalls

Mar 21, 2011   

As we previously reported, on March 10, 2011, the FDA in cooperation with the Department of Justice announced that a consent decree has been filed against McNeil, PPC, a division of Johnson & Johnson, for failing to comply with current good manufacturing practice (“cGMP”) regulations. The consent decree comes as both Congress and the FDA look improve public confidence in the pharmaceutical industry and combat questionable recall efforts by drug manufacturers.

Drug recalls are actions taken by a drug manufacturer, repackager, or distributor to remove a drug from the market. Recalls may be conducted on a firms own initiative, by FDA request, or by FDA order under statutory authority. The FDA publishes information regarding recalls, market withdrawals, and safety alerts here. The McNeil recalls came at a time when the FDA reported a spike in the volume of drug product recalls by the pharmaceutical industry. Our previous report on these increased drug recall efforts is available here.

Prior to the consent decree, McNeils cGMP violations resulted in it issuing extensive product recalls for the over-the-counter drugs its plants produced, including Tylenol, Motrin, and Benadryl in May 2010. As previously reported, the handling of these recalls by both McNeil and Johnson & Johnson led to increased scrutiny of the current drug recall process by the FDA and Congress.

Congress was particularly concerned with Johnson & Johnson and McNeils efforts to postpone recalling its products through the use of a “phantom recall.” A “phantom recall” occurs when a drug manufacturer hires contractors to go into stores and purchase its products rather than conducting a widespread and highly public voluntary recall. In essence, a “phantom recall” is an attempt by a drug manufacturer to purchase its entire possibly tainted product off the market in order to prevent a danger to consumers. However, “phantom recalls” are problematic because they allow drug manufacturers to escape formal voluntary recall efforts and leave suspected goods that were already purchased in the hands of the consumer.

In February, Fuerst Ittleman reported that Senator Charles Schumer (D-NY) introduced a bill aimed at limiting the options manufacturers may pursue in the event of a product recall. If passed, the Consumer Recall Protection Act (“CRPA”) will prohibit manufacturers from selling recalled products to consumers until the defect prompting the recall is remedied.

However, the CRPA does not directly prevent or prohibit “phantom recalls” from occurring because the act would only prevent companies from selling products to consumers once a formal recall has already been initiated. As a result, the “phantom recall” loophole will remain a viable option for drug manufacturers faced with the possible of having to engage in recall efforts.

If you have questions pertaining to the FDCA or cGMP regulations or how to ensure that your business maintains regulatory compliance at both the state and federal levels, contact Fuerst Ittleman PL at contact@fidjlaw.com.