Allergan ($AGN) is at it again. While it was fighting a hostile takeover by Valeant Pharmaceuticals ($VRX), Allergan found time to claim its free-speech rights in a dispute over eye-drug promotions. The U.S.-based drugmaker used a similar tactic back in 2009, in a lawsuit over its Botox marketing. With First Amendment claims multiplying in pharma-marketing lawsuits, Allergan apparently concluded it was time to try again.
As The Wall Street Journal reports, the case in question is a whistleblower suit that alleges Allergan offered kickbacks to doctors who prescribed more of its Restasis treatment. The inducement? Advice and information the docs could use to better manage their practices.
Allergan contends that the advice is protected speech under the First Amendment. It cited the now-infamous Sorrell v. IMS Health ruling, in which the Supreme Court struck down a Vermont law that restricted the marketing of physician prescribing data.
But the Department of Justice disagrees. Though government lawyers declined to join that whistleblower suit, they decided to put a word in on the free-speech argument. The gist: Allergan can offer counsel, services, what have you, as long as that offer isn't contingent upon gaining additional business. If it is, then that's a kickback, the DOJ reasons.
"The fact that a person may provide remuneration comprised, in whole or in part, of speech does not immunize that person from liability," the DoJ lawyers contend in a court filing (as quoted by the WSJ). "Nothing ... prevents Allergan from offering services, good or bad, as long as it does not offer those services, at least in part, to induce referrals."
Allergan's claims aren't coming from left field. In addition to the Sorrell v. IMS Health decision, a U.S. appeals court weighed in on pharma free speech in December 2012. The 2nd Circuit Court of Appeals overturned the conviction of a sales rep, Alfred Caronia, who talked up off-label uses of the narcolepsy drug Xyrem. Caronia claimed First Amendment protection--and won. And just to underscore the idea, the appeals court's decision stated that the government can't go after drugmakers and sales reps "for speech promoting the lawful, off-label use of an FDA-approved drug."
Since then, various drugmakers have put forth new free-speech arguments to defend off-label promotions. The FDA elected not to appeal the 2nd Circuit's Caronia ruling. And last month, the agency's chief counsel promised that the agency is "taking these first amendment concerns very seriously." So far, that seriousness applies to off-label marketing as free speech, rather than kickbacks as free speech. But in any case, the agency's willingness to consider the argument clashes with the DOJ's pledge to go after off-label violations aggressively, Caronia ruling or no Caronia ruling.
- read the WSJ article