Court Says Private Plaintiffs Can’t Second-Guess FDA

A North Carolina federal court decision dismissing all claims raised by Exela Pharma Sciences against Sandoz due to federal preemption is cited by attorney James Beck (Reed Shaw) as a primer for defense lawyers on the ways that preemption precludes private plaintiffs from second-guessing FDA decisions on the marketing and classification of the products the agency regulates. Beck writes in an online post that the case involved a drug that Sandoz was selling overseas and thus had not sought FDA approval. When the drug went into shortage in the U.S., the agency asked Sandoz to import and sell it under an FDA memorandum of discretion. While Sandoz was selling its product here, Exela developed and obtained FDA approval for a better and safer version of the same drug.

Exela asked Sandoz to stop selling its product and asked FDA to remove the Sandoz drug from the shortage list and prohibit any further importation and distribution.

Eventually, Beck writes, the agency declared an end to the shortage and ordered Sandoz to stop importing its product, while allowing it to continue to sell existing inventory.

Exela brought suit under state law, primarily governing deceptive trade practices and also under the Lanham Act, covering false and deceptive advertising, and made a variety of claims that second-guessed FDA’s decision to allow the Sandoz product on the market and to keep it there for as long as it did, Beck says.

The court rejected all of Exela’s claims and ruled in favor of Sandoz on its motion to dismiss the case.

Beck reviews the court’s reasoning and case citations for each of the rejected Exela claims, concluding that the written opinion is “chock full of useful preemption nuggets, and draws together citations to many cases from different areas of the law that have prevented private plaintiffs from second-guessing FDA — product liability, to be sure, but also administrative and commercial litigation.”