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January 10, 2019

SCOTUS hears oral arguments in FDA drug labeling case. Here's what it could mean for the industry.

Daily Briefing

    The Supreme Court on Monday heard oral arguments in a case centered on whether a drugmaker is liable under state law for drug-related injuries when FDA denies the drugmaker's request to revise a product's warning label.

    What executives need to know about pharmacy

    Case details

    The case before the Supreme Court focuses on whether FDA's decision to reject a drug's proposed warning label preempts a failure-to-warn claim under state law. The case involves Merck Sharp & Dohme's osteoporosis drug Fosamax. Patients in more than 1,000 lawsuits filed in federal courts claim Fosamax caused serious thigh bone fractures and argue that the drug did not have an accurate warning label.

    According to Inside Health Policy, Merck in 2008 submitted information to FDA regarding a potential link between Fosamax and a risk of atypical femur fractures. While FDA was evaluating the data, Merck also proposed adding language about the potential risk for low-energy femoral shaft fractures to the Warnings & Precautions and Adverse Reactions sections of Fosamax's label, including that some report fractures "were stress fractures (also known as insufficiency fractures) occurring in the absence of trauma."

    FDA ultimately recommended that Merck include "low energy femoral shaft and subtrochanteric fractures" to the Adverse Reactions, Post-Marketing Experience subsection of Fosamax's package inserts. The agency rejected Merck's proposed label revisions, which it said were inadequate because the "identification of 'stress fractures' may not be clearly related to the atypical subtrochanteric fractures that have been reported in the literature." FDA added, "Discussion of the risk factors for stress fractures is not warranted and is not adequately supported by the available literature and post-marketing adverse event reporting."

    But an FDA task force further examined the risks of Fosamax, and in September 2010 found an association between the use of bisphosphonates, such as Fosamax, and the risk of atypical subtrochanteric femur fractures. In light of the findings, FDA in October 2010 directed Merck and other bisphosphonate makers to revise their warning labels.

    Following FDA's order, Fosamax users filed hundreds of lawsuits against Merck, claiming they had sustained atypical femur fractures and the drugmaker had not adequately warned them about the Fosamax's risks. Merck has argued that FDA's decision to reject its proposed label revision in 2008 preempted claims that Merck violated state law by failing to warn patients about Fosamax's risks.

    A federal trial court in New Jersey sided with Merck and dismissed the lawsuits on the grounds of "impossibility preemption," which occurs when federal and state laws conflict, and it therefore is impossible for an entity to satisfy both laws.

    However, the U.S. Court of Appeals for the 3rd Circuit reversed the trial court's ruling and allowed the claims against the drugmaker to proceed. The appeals court argued a jury could determine whether FDA had rejected Merck's proposal because of the phrasing it used in the proposed label revision, as well as whether the agency would have approved "a properly worded warning." Merck appealed the court's decision to the Supreme Court.

    SCOTUS hears oral arguments

    During Monday's oral arguments in the case, the Supreme Court justices questioned whether FDA in 2008 understood that Merck had proposed using the term "stress fracture" to broadly include major fractures, such as atypical subtrochanteric fractures. Specifically, Justice Elena Kagan said the case centers on three main questions:

    • What label did Merck propose?;
    • How did FDA respond to the proposed label?; and
    • Did Merck and FDA have the same understanding of the label?

    During the arguments, Shay Dvoretzky, the petitioner on behalf of Merck, said it is FDA's responsibility to help drugmakers identify the appropriate phrasing for a drug's label after the agency has received supplemental data for a proposed revision.

    However, Kagan said that premise is "not a good understanding" of FDA's statutory obligation. Kagan said, "The idea that they have to look through all of your data, even though you pinpoint an entirely different risk, in order to find out what the real risk is, and—that if they don't manage to do that, you're exempt from suit, that seems to me a very counterintuitive reading of the statute and, indeed, not just counterintuitive, it seems to conflict with … the statutory provision, the rule of construction that says that manufacturers have primary responsibility over their labels."

    Justice Neil Gorsuch said Merck's interpretation of the statue could create a "moral hazard," because it could motivate drugmakers to submit an overwhelming amount of data to FDA with proposed labels that might not be "the most artfully drafted and may be deliberately inartfully drafted" so that FDA rejects the propose warnings and allows a drugmaker to avoid liability for patient injuries. Gorsuch asked, "What comfort can you give the court that that's not the outcome of the statutory regime reading that you're proposing?"

    But Department of Justice Deputy Solicitor General Malcolm Stewart, which argued on behalf of Merck, claimed FDA understood that Merck had intended to use the term "stress fractures" to "refer more generally to any fracture that was caused without external trauma," and had rejected the proposed label revision because there was not enough evidence at the time to justify including a warning about the fractures on the label.

    According to Reuters, Justice Stephen Breyer expressed concerns that updating drug labels when there is not enough evidence to warrant doing so might be harmful, because it could deter physicians from prescribing therapies to patients who need the treatments.

    After the arguments concluded, Chief Justice John Roberts and Justices Samuel Alito, Breyer, and Gorsuch appeared to side with Merck, while Kagan and Sotomayor did not, FiercePharma reports. According to Reuters, Justice Ruth Bader Ginsburg was not present for the oral arguments because she is recovering from lung cancer surgery, but she will participate in the ruling.


    According to FiercePharma, the Supreme Court's ruling is expected to affect the drug industry no matter the outcome. The pharmaceutical industry claims that if Merck losses the case, the industry will begin to propose speculative label warnings.

    However, patient advocates claim if Merck wins the case, drugmakers will begin to deliberately propose inadequate label warnings to FDA and expect the agency's rejection will protect them against injury-related litigation (Chung, Reuters, 1/7; Liu, FiercePharma, 1/8; Wang, Inside Health Policy, 1/7 [subscription required]; "Merck Sharp & Dohme Corp. v. Albrecht," SCOTUSblog, accessed 1/9; McCuskey, SCOTUSblog, 1/8).

    What executives need to know about pharmacy

    While historically pharmacy may have been viewed as a cost center, today pharmacy services generate a significant portion of system revenues and are essential to the achievement of strategic system-level priorities.

    To better understand increasingly complex pharmacy issues and the critical role pharmacy plays in overall health system success, download our executive briefings on hot pharmacy topics.

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