Allergan, Inc., the manufacturer of Botox ® Cosmetic, has agreed to plead guilty to one count of misbranding, a violation under the Food, Drug, and Cosmetic Act (“FDCA”). The company pled guilty to misbranding for its off-label promotion of Botox for unapproved uses.

Botox is an injectable neurotoxin commonly used in cosmetic procedures to smooth wrinkles. The FDA has also approved the use of Botox to treat certain muscle spasms and excessive underarm sweating. However, authorities allege that from 2000 to 2005 Allergan marketed Botox for use in treating headaches, pain, muscle stiffness, and cerebral palsy in juveniles, none of which were ever approved by the Food and Drug Administration (“FDA”). Under Federal law, although doctors can prescribe drugs for unapproved uses, pharmaceutical companies are prohibited from advertising or promoting unapproved uses for drugs currently on the market. Authorities also allege Allergan paid kickbacks to doctors who used Botox for off-label purposes and taught doctors how to miscode Botox claims when submitting these claims for Medicare and Medicaid billing.

Under the terms of the plea agreement, Allergan agreed to plead guilty to one count of misbranding and will pay $375 million in criminal penalties. The company also agreed to a five year compliance plan that will require it to disclose payments to doctors on its website and have senior executives and board members annually certify that the company is complying with federal regulation. The plea agreement also required the company to drop its lawsuit against the FDA which it filed in October 2009 that challenged an FDA rule that prohibits pharmaceutical companies from marketing drugs for off-label uses. Allergan also agreed to pay $225 million to resolve the civil claims against the company filed by five whistle-blowers in Georgia under the False Claims Act. The $600 million settlement is the fifth largest amount paid by a single defendant in a misbranding case.

In the wake of the companys guilty plea and $600 million penalty, a shareholder of Allergan has filed suit against the members of Allergans board of directors. The suit, filed in Delaware state court, alleges breaches of fiduciary duties and is seeking to shift settlement costs to the members of the Allergan board of directors in an effort to hold board members responsible for the $600 million in penalties the company now faces.

For more information on FDA regulations, labeling guidelines, and acceptable pharmaceutical marketing practices please contact us at contact@fidjlaw.com.

The Food and Drug Administration has issued warning letters to two large producers of green tea drinks to discontinue unauthorized and unproven health and nutrient claims on their labels and websites. The warning letters were issued to the Dr. Pepper Snapple Group for its Canada Dry Sparking Green Tea Ginger Ale (“Canada Dry”) and to Unilever Inc. for its Lipton Green Tea 100% Naturally Decaffeinated product (“Lipton”). The warning letters are part of a larger campaign by the FDA to improve the accuracy and useful information of food labeling.

In its warning letter to Canada Dry, the FDA stated that the company’s sparkling green tea ginger ale made improper claims to be “enhanced” with antioxidants. Canada Dry’s label claims its green tea ginger ale is “enhanced with 200mg of antioxidants from green tea and vitamin C.” However, because Canada Dry is a carbonated drink, the FDA classifies it as a snack food. Current FDA policy does not consider it appropriate to fortify snack foods. As a result, Canada Dry cannot claim that its product is enhanced with antioxidants. Additionally, the FDA also warned Canada Dry that the ingredients claiming to contain antioxidants “are not nutrients with recognized antioxidant activity” under FDA regulations. As a result of these violations the FDA has found Canada Dry to be misbranded under the Food Drug and Cosmetic Act (“FDCA”).The full warning letter to Canada Dry can be read at: FDA Warning Letter To Canada Dry.

Unilever, the manufacturer of Lipton, was warned that its website for its Lipton product made misleading health claims and that Lipton’s antioxidant labeling did not follow FDA guidelines. In its warning letter, the FDA takes issue with Lipton’s website’s reference to four studies that showed a cholesterol-lowering effect of drinking green tea. The FDA found that the therapeutic claims are misleading because it suggests that Lipton is designed to treat or prevent disease. The FDA stated that these claims would result in Lipton being classified as a drug under the FDCA and subject Lipton to requirements for proving the safety and effectiveness of the cholesterol-lowering claims before the product could be legally marketed in the US. The FDA also stated that Lipton’s antioxidant labeling claims violate several federal guidelines. Due to these violations, the FDA has found Lipton to be misbranded under the FDCA.  A full copy of the FDA’s warning to Lipton can be read at: FDA Warning Letter To Lipton.

As the nutrient-enriched beverage market continues to grow into a multibillion dollar business, the FDA will continue its efforts to crack down on companies that overstate the benefits of their products. For more information on FDA regulation and labeling guidelines, please contact us at contact@fidjlaw.com.

On September 9, 2010, the Food and Drug Administration (“FDA”) announced its intent to regulate electronic cigarettes and issued warning letters to five e-cigarette manufacturers for violations of the Food, Drug, and Cosmetic Act (“FDCA”). Warning letters were issued for various violations of the FDCA including violations of good manufacturing practices, making unsubstantiated drug claims, and using the devices as delivery mechanisms for active pharmaceutical ingredients. A copy of the FDAs press release can be read here: FDA Acts Against E-Cigarette Distributors.

E-cigarettes are battery-powered devices that allow users to inhale vaporized liquid nicotine instead of tobacco smoke. As these devices have become more popular, the FDA has become increasingly concerned with the safety and effectiveness of these devices as smoking cessation aids. In July, the FDA issued a press release expressing its concerns with the e-cigarette stating that because e-cigarettes have not been submitted to the FDA for evaluation or approval, the levels of nicotine and other chemicals that the products deliver to its users are unknown. The press release regarding safety concerns with the e-cigarettes can be read at FDA Warns of Health Risks Posed by E-Cigarettes.

In a letter to the Electronic Cigarette Association on September 8, 2010, the FDA advised the e-cigarette industry of its intent to regulate e-cigarettes. The FDA has determined that e-cigarettes “meet the definitions of both a drug and a device under the [FDCA] and the definition of a combination product in 21 C.F.R. Part 3, with a drug primary mode of action.” A full copy of the FDAs letter to the Electronic Cigarette Association can be read at FDAs Letter to the E-Cigarette Association.

As a result of this new classification by the FDA, e-cigarette manufacturers will have to comply with the FDCA and numerous regulations regarding the marketing and approval of drugs. Under the FDCA, a company must demonstrate that a drug is safe and effective for its intended use before that product will gain FDA approval. This will require e-cigarette manufacturers to provide proof that e-cigarettes safely and effectively reduce its users dependence on nicotine. Additionally, manufacturers must demonstrate that its manufacturing practices preserve the strength, quality, and purity of the drug. The FDCA also prohibits a company from claiming that a drug can treat or mitigate a disease, including nicotine addiction, unless the drugs safety and effectiveness has been proven.

For more information regarding current FDA authority, procedure, or regulations please contact us at contact@fidjlaw.com.