On May 20, 2019, the United States Supreme Court decided Merck v. Albrecht (In re Fosamax), No. 17-290 (text version available here), destroying most of the arguments routinely used by drug companies to claim that plaintiffs’ cases are “preempted” and have to be dismissed. The law for people injured by branded prescription drugs is far better now than it was before Albrecht, and as a result, it is likely that far more victims will get to see their day in court.
After Albrecht, a branded prescription drug manufacturer can establish impossibility preemption — which happens when federal law makes it “impossible” for defendants to comply with state tort laws that enable victims to seek compensation — only if they can show:
- The manufacturer “fully informed” the FDA by providing both all “material” safety information and an “evaluation or analysis concerning the specific dangers” raised by the plaintiff; and,
- The FDA took action, “carrying the force of law,” to disapprove the warning proposed by the plaintiffs.
The Supreme Court’s analysis in Albrecht is far more narrow than any preemption argument ever proposed by drug manufacturers, and far more narrow than the “clear evidence” tests many lower courts have been using since Wyeth v. Levine, 555 U.S. 555 (2009). As the Supreme Court itself said, “a drug manufacturer will not ordinarily be able to show that there is an actual conflict between state and federal law such that it was impossible to comply with both.” Albrecht at *17.
Let’s dig in.
Albrecht Clarifies Levine’s “Clear Evidence” Dicta
My initial prediction that the Supreme Court would not grant certiorari in Albrecht was incorrect, but my subsequent prediction about the case result was right. As I wrote back in June of 2018, based on Justice Thomas’s and Justice Gorsuch’s prior writings about preemption, “unless multiple Justices reverse course and adopt positions contrary to their prior opinions, in Fosamax there simply is no path to victory for drug companies.” Justice Thomas and Justice Gorsuch did indeed join the majority opinion written by Justice Breyer, thereby producing a six Justice majority opinion.
Much of the reporting and defense bar discussion about Albrecht has focused on the part with the least amount of practical importance: whether the judge or the jury decides preemption.
Given how most preemption issues were decided one way or another on summary judgment, the Third Circuit was the first court in the ten years since Levine that needed to grapple with this question, and it held that preemption often produced a disputed question of fact that a jury would have to resolve. The Supreme Court reversed the Third Circuit on that issue: preemption is a question of law for the judge to decide.
If the Supreme Court had stopped there, the opinion would have been a minor loss for plaintiffs. But the Court went on to explain how impossibility preemption works in branded drug lawsuits and to elaborate on the “clear evidence” test, and in the course of that eliminated the overwhelming majority of arguments that drug companies typically make in support of preemption.
Explaining why the Albrecht opinion is so helpful to plaintiffs requires going back a decade.
Ever since the Supreme Court decided Wyeth v. Levine in 2009, “preemption” has been the boogeyman feared most by lawyers who represent people injured by branded prescription drugs. If a court finds “impossibility preemption” — that is, if a court finds that the state tort law which enables victims to seek compensation conflict with federal law, making it ‘impossible’ for a defendant to comply with both — then the case is simply dismissed, regardless of how negligent the drug company was and regardless of how much scientific and medical testimony the plaintiff has.
Levine shouldn’t have been such a problem for plaintiffs: the plaintiffs in that case won, and the Supreme Court agreed their case wasn’t preempted. But in the years that followed, drug manufacturers sometimes convinced lower courts that a single sentence from Levine meant defendants could use all kinds of evidence — including hypothetical scenarios with speculation about the “intent” of the FDA — to create federal “law” sufficient to preempt state tort lawsuits and get all of the cases dismissed.
Levine reiterated that “impossibility preemption is a demanding defense.” 555 U.S. at 573. The drug companies’ arguments about preemption all arose from a single sentence of dicta in Levine: “absent clear evidence that the FDA would not have approved a change to [the drug’s] label, we will not conclude that it was impossible for [the drug manufacturer] to comply with both federal and state requirements.” 555 U.S. 555, 571 (2009). The Supreme Court didn’t explain what that “clear evidence” could be, and, frankly, it was difficult to understand what that “clear evidence” even could be. As Justice Thomas explained in his concurrence, “pre-emption must turn on whether state law conflicts with the text of the relevant federal statute or with the federal regulations authorized by that text,” and the text of the Food, Drug & Cosmetics Act (FDCA) did not in any way conflict with state tort law, and so thus “there is no ‘direct conflict’ between the federal labeling law and the state-court judgment.” Levine, 555 U.S. at 588, 592 (2009)(Thomas, concurring).
Over time, however, drug companies were sometimes able to convince courts that preemption applied if “there was clear evidence the FDA would have rejected the proposed change in the drug’s label.” Mason v. Smithkline Beecham Corp., 596 F.3d 387, 391 (7th Cir. 2010). Some Courts went completely overboard, like Gibbons v. Bristol-Myers Squibb Co., 2019 WL 1339013 (2d Cir. March 26, 2019), which turned Levine on its head and held that preemption was presumed for all branded drugs, and thus a plaintiff was required to plead around preemption. (As explained below, the Gibbons case is now a dead letter, since it conflicts with Albrecht.)
Levine’s actual analysis never suggested that drug companies could start wildly speculating about what what the FDA “would have” done when the FDA didn’t actually reject a proposed change, but drug companies began stretching that sentence as far as they could, with cases citing everything from declined Citizen’s Petitions, to medical journal articles, to notes of conversations with FDA staffers as “clear evidence.”
Merck v. Albrecht just eliminated all of those arguments, and provided a clean definition for the type of “clear evidence” necessary for preemption. The Supreme Court held:
clear evidence is evidence that shows the court that the drug manufacturer fully informed the FDA of the justifications for the warning required by state law and that the FDA, in turn, informed the drug manufacturer that the FDA would not approve a change to the drug’s label to include that warning.
Merck v. Albrecht, No. 17-290, at *4-5 (U.S. May. 20, 2019). Preemption is thus now a two-part test.
Albrecht Test Part One: The Drug Manufacture Must Have Provided The FDA All Material Safety Information And An Evaluation Of The Specific Dangers That Merit The Warning
First, the defendant must present “evidence that shows the court that the drug manufacturer fully informed the FDA of the justifications for the warning” the plaintiff claims should have been included with the drug.
There are two independent requirements for part one to be established:
a) The FDA must be “fully informed.” As the Supreme Court says, one of the factual disputes the judge might be confronted with is “whether the drug manufacturer submitted all material information to the FDA,” id at *19, and thus “fully informed” means the FDA had “all material information.” If a drug company failed to provide all material safety information to the FDA, then preemption is simply not available.
Notably, this was also the position of the United States in its amicus brief, which argued: “To be sure, an actual FDA labeling decision might not in itself resolve preemption if, for instance, FDA did not consider certain safety information in approving name-brand drug labeling or in denying a labeling change because the information was not provided to FDA or because it arose after FDA’s decision.”
b) The manufacturer must have also provided “the justifications for the warning.” As the Supreme Court explained that would be, those “justifications” would only be met by, as previously mentioned in Levine, “‘suppl[ying] the FDA with an evaluation or analysis concerning the specific dangers’ that would have merited the warning.” at *15 (quoting Levine at 572-573). Even if a drug company provided all the material safety information, if they did did not provide an evaluation or analysis on the specific dangers in question to “fully inform the FDA of the justifications for the warning,” then preemption is simply not available.
Albrecht Test Part Two: The FDA Must Have Taken Action, Carrying The Force Of Law, To Disapprove The Proposed Warning
Second, the defendant must have “evidence that shows the court … the FDA, in turn, informed the drug manufacturer that the FDA would not approve a change to the drug’s label to include that warning.”
The appropriate “evidence” that can be used to meet part two is narrowly circumscribed.
a) Preemption hinges on the content of federal law, and so speculation about what the FDA “would have” done in some counterfactual situation is insufficient to establish preemption:
The underlying question for this type of impossibility pre-emption defense is whether federal law (including appropriate FDA actions) prohibited the drug manufacturer from adding any and all warnings to the drug label that would satisfy state law. And, of course, in order to succeed with that defense the manufacturer must show that the answer to this question is yes.
Albrecht at *16. Stated another way:
[T]he judge must simply ask himself or herself whether the relevant federal and state laws “irreconcilably conflic[t].” Rice v. Norman Williams Co., 458 U. S. 654, 659 (1982); see ibid. (“The existence of a hypothetical or potential conflict is insufficient to warrant the pre-emption of the state statute”).
Albrecht at *17.
Thus, the drug manufacturer must rely on the existing regulatory record, and cannot invent scenarios in which preemption might have happened nor speculate about the FDA’s mindset or intent. Instead, the drug manufacturer must point to real-world FDA actions in the regulatory record that they contend create preemption.
b) The only FDA actions worthy of consideration in a preemption analysis are those that carry the force of law. As the passage quoted above says, “federal law” can include “appropriate FDA actions.” But “appropriate FDA actions” doesn’t mean anything that anyone at the FDA said or did, it means “only” FDA actions that “carry the force of law:”
[T]he only agency actions that can determine the answer to the pre-emption question, of course, are agency actions taken pursuant to the FDA’s congressionally delegated authority. The Supremacy Clause grants “supreme” status only to the “the Laws of the United States.” U. S. Const., Art. VI, cl. 2. And preemption takes place “‘only when and if [the agency] is acting within the scope of its congressionally delegated authority, . . . for an agency literally has no power to act, let alone pre-empt the validly enacted legislation of a sovereign State, unless and until Congress confers power upon it.'” New York v. FERC, 535 U. S. 1, 18 (2002) (some alterations omitted). Federal law permits the FDA to communicate its disapproval of a warning by means of notice-and-comment rulemaking setting forth labeling standards, see, e.g., 21 U. S. C. §355(d); 21 CFR §§201.57, 314.105; by formally rejecting a warning label that would have been adequate under state law, see, e.g., 21 CFR §§314.110(a), 314.125(b)(6); or with other agency action carrying the force of law, cf., e.g., 21 U. S. C. §355(o)(4)(A). The question of disapproval “method” is not now before us.
Albrecht at *18. Drug manufacturers routinely try to support preemption with weak, circumstantial evidence, like phone calls with FDA staffers or ambiguous remarks in FDA briefing materials. None of those are sufficient to establish preemption. Preemption is a matter of federal law, and mere statements or implications by the FDA are not enough to create law — that can only be done through “agency action carrying the force of law.” Albrecht at *18.
As if to underscore just how narrow the “clear evidence” rule is supposed to be, even though the plaintiffs in Fosamax didn’t dispute that the FDA had all the material safety information and didn’t dispute that the FDA had issued a “complete response letter” that rejected a warning similar to the warning plaintiffs say should have been provided, the Supreme Court still did not enter judgment for Merck, but instead remanded the case back to the Third Circuit for further consideration. The evidence Merck presented to the Supreme Court was simply not enough to satisfy the two-part Albrecht test: the Third Circuit still needs to consider if Merck provided a sufficient “evaluation or analysis concerning the specific dangers’ that would have merited the warning,” and also needs to determine if the FDA truly rejected the warning with an agency action that carried the force of law. Justice Thomas’ concurrence argued, among other points, that Merck would not be able to meet the latter element even if the complete response letter had rejected the exact warning proposed by plaintiffs: “As this regulation suggests and the FDA has explained, complete response letters merely ‘infor[m] sponsors of changes that must be made before an application can be approved, with no implication as to the ultimate approvability of the application.’ 73 Fed. Reg. 39588.” Albrecht at *25 (Thomas, concurring).
I expect that drug manufacturers will continue to file preemption motions in virtually every branded drug case, despite the Supreme Court’s admonition that “a drug manufacturer will not ordinarily be able to show that there is an actual conflict between state and federal law such that it was impossible to comply with both.” Albrecht at *17. The only question is if the courts will follow the Supreme Court’s instructions or ignore them by twisting Albrecht the way some courts twisted Levine.