Mutual Pharmaceutical Co. v. Bartlett

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LII note: The U.S. Supreme Court has now decided Mutual Pharmaceutical Co. v. Bartlett.

Oral argument: 
March 19, 2013

After receiving a prescription for sulindac, the generic version of Clinoril, Karen Bartlett developed Stevens-Johnson Syndrome and toxic epidermal necrolysis, rare skin disorders that causes the sufferer’s skin to deteriorate by either being burned off or by turning into an open wound. Bartlett subsequently suffered painful, permanent injuries, including near-blindness, esophageal burns, and lung damage. A New Hampshire federal jury awarded Bartlett $21.06 million for her injuries based on a New Hampshire products liability claim for defective design. Mutual Pharmaceutical Company, a sulindac manufacturer, now challenges that decision by arguing that federal law regulating generic drugs preempts New Hampshire's design-defect law. The United States Court of Appeals for the First Circuit upheld the lower court design, finding no preemption, despite Supreme Court precedent finding preemption in similar contexts. Mutual Pharmaceutical argues that the Food, Drug, and Cosmetic Act preempts the state design-defect law because the Act requires generic drug manufacturers to produce generic medications that are bioequivalent to the corresponding name brand version of the drug. Bartlett responds that the state law does not conflict with federal law because the state law imposes no duty for sellers to change their product from the name brand version.

Questions as Framed for the Court by the Parties 

Whether the First Circuit erred when it created a circuit split and held-in clear conflict with this Court's decisions in PLIVA, Inc. v. Mensing, 131 S. Ct. 2567 (2011); Riegel v. Medtronic, Inc., 552 U.S. 312 (2008); and Cipollone v. Liggett Group, Inc., 505 U.S. 504 (1992)-that federal law does not preempt state law design-defect claims targeting generic pharmaceutical products because the conceded conflict between such claims and the federal laws governing generic pharmaceutical design allegedly can be avoided if the makers of generic pharmaceuticals simply stop making their products.


Does federal law governing claims against generic pharmaceutical products preempt state law design-defect claims against the makers of those products?



In December of 2004, Karen Bartlett’s doctor prescribed her Clinoril for shoulder pain. However, when Bartlett filled her prescription, instead of dispensing Clinoril, Bartlett’s pharmacist dispensed sulindac, Clinoril’s generic equivalent. In rare instances, sulindac has been known to cause allergic reactions known as Stevens-Johnson Syndrome (“SJS”) and toxic epidermal necrolysis (“TEN”). Both SJS and TEN cause the sufferer’s skin to deteriorate by either being burned off or by turning into an open wound.

As a direct result of using sulindac, Bartlett began suffering from SJS and TEN in early 2005 and between sixty and sixty-five percent of the skin on Bartlett’s body either disintegrated or became an open sore. Due to these injuries, Bartlett spent seventy days in the Massachusetts General Hospital, with over fifty of these days being spent in the hospital’s burn unit. Bartlett not only experienced pain and suffering at the time of her injuries, but also suffered permanent injuries following her release from the hospital including near-blindness, esophageal burns, and lung injuries.

Bartlett brought suit against Petitioner Mutual Pharmaceutical (“Mutual”), a sulindac manufacturer for: breach of warranty; fraud; negligence; design defect; failure to warn; and manufacturing defect. These causes of action were either dismissed by the New Hampshire state court on summary judgment or voluntarily by Bartlett until only the design defect claim remained. Ultimately, Bartlett’s final complaint consisted of the single allegation that sulindac is “unreasonably dangerous” to consumers because the risks of taking sulindac significantly outweigh the potential benefits. Bartlett filed this complaint notwithstanding the fact that the federal Food and Drug Administration (“FDA”) has never withdrawn its statutory “safe and effective” designation for the Clinoril. The FDA’s safe and effective designation not only allowed the original maker of Clinoril to manufacture and sell the drug, but also permitted generic drug makers, such as Mutual, to manufacture sulindac.

Bartlett presented her claims against Mutual during a fourteen-day trial in late August and early September of 2009. During the trial, one of Bartlett’s witnesses, a pharmacologist/toxicologist, used incident reports and other data to demonstrate that sulindac was more likely to cause SJS and TEN than other available drugs and that sulindac had a safety profile similar to other drugs that were deemed too dangerous to remain on the market. A burn surgeon also testified on Bartlett’s behalf and alleged that sulindac had design defects. The presiding state court judge ultimately denied Mutual’s motion for judgment as a matter of law under federal rule of civil procedure 50(b) and Mutual’s motion for a new trial under federal rule of civil procedure 59. Bartlett subsequently won $21.06 million in compensatory damages.

On appeal before the First Circuit Court of Appeals, Mutual argued: that the district court misconstrued New Hampshire law on design defect claims; that federal law preempts state law design defect claims for generic drugs; that Bartlett failed to prove the cause of her injuries; that Bartlett introduced inadmissible expert testimony; that drug label warning instructions were inaccurate; that Bartlett's counsel engaged in misconduct that required a new trial; and that Bartlett’s damages were excessive and required a new trial. Despite Mutual’s assertions, the First Circuit Court of Appeals affirmed the New Hampshire state court’s decision.

Mutual subsequently filed for a writ of certiorari on July 31, 2012, which the Supreme Court granted on November 30, 2012, and now appeals the First Circuit Court of Appeals’ decision.



Effect on Access to Generic Medications

The U.S. Chamber of Commerce and the Pharmaceutical Research and Manufacturers of America (“PHRMA”) argue that exposing generic drug manufacturers to state law tort liability will negatively impact the American healthcare system by denying physicians and patients in some states access to certain generic medications. Specifically, the U.S. Chamber of Commerce and PHRMA contend that, since generic drug manufacturers distribute their products through a vast and complex distribution system, it will be nearly impossible for generic drug manufacturers to distribute certain drugs to only some states. Thus, the U.S. Chamber of Commerce and PHRMA allege that the difficulty of tailoring the distribution of certain generic medications will encourage generic pharmaceutical companies to stop selling certain generic medications altogether.

John and Tammy Gilbert, Deborah Kinter, Donald Brown, and Alice Szromba (all of whom are suing several drug manufacturers for drug-related injuries) argue that subjecting generic drug manufacturers to state tort liability will not negatively impact doctors and patients in states where certain generic drugs are banned because the prohibition of unreasonably dangerous drugs extends to both the name brand and generic versions of drugs. They argue that by allowing generic alternatives to certain drugs, Congress intended to encourage the manufacture of safe drugs, not dangerous ones. The American Association for Justice (“AAJ”) and Public Justice also note that blocking tort remedies against generic drug manufacturers would unjustly deprive injured patients of compensation.

Impact on Safety of Generic Medications

John and Tammy Gilbert, Deborah Kinter, Donald Brown, and Alice Szromba argue that exposing generic drug manufacturers to state law tort liability will increase the cost of unsafe drugs. Moreover, FDA Commissioners Dr. Donald Kennedy and Dr. David A. Kessler note that the FDA lacks the resources and practical ability to adequately protect the public from unsafe products on its own. Dr. Kennedy and Dr. Kessler point to the fact that the FDA frequently approves generic drugs that have latent safety hazards that become evident only after the drugs are sold on the market. In addition, Dr. Kennedy and Dr. Kessler note that, since the FDA can rarely find sufficient clinical trial participants who belong to population subgroups, the effects of generic drugs on these subgroups is rarely known prior to the drugs’ approval. Thus, Dr. Kennedy and Dr. Kessler argue that subjecting generic drug manufacturers to state tort liability is crucial to support the FDA’s underlying concerns for safety.

The Generic Pharmaceutical Association ("GPA") counters that generic drug manufacturers do not need an incentive to further ensure the safety of their drugs because the FDA already heavily regulates the safety generic drugs. Further, the U.S. Chamber of Commerce and PHRMA argue that subjecting pharmaceutical manufacturers to state law tort liability will increase the burden on new drug applicants seeking to comply with the FDA’s regulatory regime. The GPA contends that exposing pharmaceutical manufacturers to state law tort liability will decrease competition in the pharmaceutical industry because many generic drug manufacturers will be unwilling to bear the risk of facing state law tort liability and costly meritless lawsuits.



The Supreme Court will decide whether federal laws regulating generic drugs block people from suing under state laws for defective drugs and whether states can give manufacturers the option to stop making their products to avoid this conflict between state and federal law. Under the Supremacy Clause of the United States Constitution, federal laws represent the supreme law of the land and may preempt or override state laws. The Hatch-Waxman Act allows generic drug makers to bypass extensive testing requirements and enter the market if they can prove that their generic drug is equivalent to an approved brand-name drug and carries the same labeling. In PLIVA, Inc. v. Mensing, the Supreme Court held that the "sameness" requirement of the Hatch-Waxman Act preempted state-law duties that had imposed stricter labeling requirements on generic drugs.

The parties disagree over whether the underlying state claim truly conflicts with the language and purpose of federal law. Petitioner Mutual Pharmaceutical (“Mutual”) argues that federal laws requiring “sameness” between brand-name drugs and their generic counterparts preempt state design-defect claims because those claims impose duties on manufacturers that are inconsistent with the federal sameness requirement. Respondent Bartlett argues that the state design-defect claim does not conflict with the sameness requirement because it imposes no duties on manufacturers who may avoid liability by stopping production.

Conflict with the "Sameness" Requirement

Mutual argues that the New Hampshire law about defective designs in products makes it impossible to comply with the requirement under Food, Drug, and Cosmetic Act ("FDCA") that manufacturers keep generic drugs the same as their branded counterparts. Mutual contends that this case falls within the Supreme Court's decision in PLIVA, Inc. v. Mensing, which held that the FDCA and the Hatch-Waxman Act preempted a state-created failure-to-warn claim. Although the Mensing holding directly addressed only failure-to-warn claims, Mutual maintains that the holding also applies to claims alleging a product's defective design. Mutual asserts that because the Court in Mensing noted that federal law requires generic drugs to have the same label and the same active ingredients, its holding extends to defective-design claims under state law. Additionally, Mutual argues the provision in New Hampshire that a company stop selling a generic drug that cannot meet the state requirements emphasizes the impossibility of complying with both state and federal law.

Bartlett responds that Mutual not only must meet a high standard to show that state law made it impossible to comply with federal law but also could comply with both federal and state laws. Bartlett further argues that Mensing involved a claim under common law imposing a duty on manufacturers that conflicted with federal law. Distinguishing Mensing from this case, Bartlett argues that the design-defect claim is a strict liability case which does not impose a duty on the manufacturers. Accordingly, Bartlett asserts that the Mensing Court held that it was a duty in the state to improve a warning label in conflict with federal law but did not decide whether federal law preempts a state law of strict liability. Bartlett argues that in strict liability the analysis balances the risks against the benefits of a drug in determining whether it is unreasonably dangerous. To Bartlett, the dangerousness of the drug and not the warning itself is the focus of the design-defect claim and so may work in concert with federal law.

Mutual contends that liability under a design-defect claim still arises out of the violation of a state-created common-law duty. Mutual argues that strict liability is like a state duty under the common law because both are methods of governing behavior and so should be treated similarly for preemption analysis. Moreover, Mutual asserts that the Supremacy Clause prohibits states from conditioning the right of manufacturers to engage in interstate commerce on behavior that violates federal law or punishing parties for complying with federal law. Accordingly, Mutual also argues that allowing manufacturers to stop selling a drug does not evade the conflict with federal law. To Mutual, imposing a choice between changing the drug and not selling the drug in state would force a drug manufacturer to alter a drug in violation of federal law just to access a state market. Therefore, Mutual asserts, a stop-selling rationale would make state law the de facto supreme law of the land.

Bartlett responds that compliance with federal law is possible even if there was a duty not to sell the product. Bartlett contends that the Hatch-Waxman Act does not involve a requirement to sell the product, but only a permissive means of doing so. Moreover, Bartlett argues that a stop-selling rationale would not apply to every preemption case because here drug makers would meet their duty by not selling a product while drug makers charged with strengthening a label would avoid their duty by not selling the product. Thus, according to Bartlett, a manufacturer could meet its state law duty by not selling a product while still not violating any federal mandate.

Conflict with the Purposes of Federal Law

Mutual argues that the New Hampshire design-defect claim is also preempted because it obstructs the purposes of federal law. Specifically, Mutual argues that the design-defect claim disrupts Congress's intention to encourage the sale of generic versions of pharmaceuticals. According to Mutual, the Hatch-Waxman Act provides an efficient procedure for generic drugs to enter the market place by matching their branded counterparts. Moreover, Mutual contends that Congressional intent is easy to determine in this case. Mutual asserts that the purpose of the statute flows naturally from the text and is clear in the legislative history. Finally, Mutual Pharmaceutical argues that a stop-selling theory conflicts with this purpose and the broader purpose of federal law which seeks to take federal control over the pharmaceutical marketplace.

Bartlett contends that the Court should not consider Mutual’s conflict-with-purpose argument because they failed to raise the issue in their petition for certiorari to the Supreme Court. Moreover, Bartlett argues that the Court should not find preemption based on an obstacle to federal purposes because "obstacle preemption" has a high threshold of proof and Mutual failed to meet that threshold. Bartlett also argues that the purpose of the FDCA is not to give drug makers a right to the marketplace but rather to protect consumers. Here, Bartlett argues, the design-defect claims further this purpose of protecting consumers by removing unreasonably dangerous products and incentivizing patients to make their injuries known, which supplements federal regulation.



In this case, the Supreme Court will further define the scope federal law in the context of generic pharmaceutical products. Moreover, the Court will determine whether states have the right to control the generic drug industry through the implementation of private civil claims. Petitioner Mutual Pharmaceutical argues that states do not have the right to impose liability for defective designs against generic drug makers because doing so conflicts with the "sameness" requirement of the Food, Drug, and Cosmetic Act. Respondent Karen Bartlett contends that preemption does not apply in this context because state strict liability claims do not impose a duty on generic drug makers to change their products or otherwise violate federal law. The Supreme Court's decision will ultimately decide which civil remedies states can fashion for residents injured by generic pharmaceuticals by balancing the language and purposes of federal food and drug law against states’ traditional rights to regulate public health and safety.


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