Regulating Drug Promotion on the Internet

Food and Drug Law Journal

Volumn 54, Issue 4, 1999, Pages 599-621

  Brannon, Leah ^a  

^a Climate Change and Clean Technology Practice   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

DRUG INDUSTRY; DRUG INFORMATION; DRUG MARKETING; FOOD AND DRUG ADMINISTRATION; INTERNET; MASS MEDIUM; REVIEW;

ADVERTISING; GUIDELINES; HUMANS; INTERNET; PRODUCT LABELING; UNITED STATES; UNITED STATES FOOD AND DRUG ADMINISTRATION;

EID: 0033389088     PISSN: 1064590X     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Review

References (205)

1. Department of Health and Human Services (DHHS), Food and Drug Administration (FDA), FDA and the Internet: Advertising and Promotion of Medical Products, Oct. 16-17, 1996, (last modified Nov. 20, 1996) 〈www.fda.gov/opacom/morechoices/transcript1096/fdainet.html〉 [hereinafter Internet Conference], at Discussion Group 2, Comments of Dr. Grebenau.
2. Id. at Discussion Group 3, Comments of Dr. Allen Douma, Medical Director and CEO of Health Response Ability Systems ("[I]t is the wild frontier."). See also id., Comments of Lee Peeler, Associate Director for the Division of Advertising Practices, Federal Trade Commission (FTC) ("It is like the wild, wild west out there."). Typical promotions on the Internet today include those for unapproved devices, dangerous herbal remedies and counterfeit drugs. See, e.g., Carl T. Hall, HIV Do-It-Yourself Test Kits Worry U.S. Health Experts, S.F. CHRON., Jan. 13, 1999, at A1; Amy Smith, Medical Advice From Internet May Be Unsafe, KNOXVILLE NEWS-SENTINEL, Jan. 26, 1998 (describing a consumer's acute kidney failure after he ingested wormwood oil purchased over the Internet from a site promoting the toxic product as an herbal remedy); Russell Watson, The Globe is Gaga for Viagra, (last visited on Nov. 6, 1999) 〈www.newsweek.com/nw-srv/issue/25_98a/printed/us/in0325.htm〉 (describing a lucrative Internet-based black market in products - including flour and corn starch - falsely promoted as "Viagra").
3. Id. at Discussion Group 3, Comments of Dr. Allen Douma, Medical Director and CEO of Health Response Ability Systems ("[I]t is the wild frontier."). See also id., Comments of Lee Peeler, Associate Director for the Division of Advertising Practices, Federal Trade Commission (FTC) ("It is like the wild, wild west out there."). Typical promotions on the Internet today include those for unapproved devices, dangerous herbal remedies and counterfeit drugs. See, e.g., Carl T. Hall, HIV Do-It-Yourself Test Kits Worry U.S. Health Experts, S.F. CHRON., Jan. 13, 1999, at A1; Amy Smith, Medical Advice From Internet May Be Unsafe, KNOXVILLE NEWS-SENTINEL, Jan. 26, 1998 (describing a consumer's acute kidney failure after he ingested wormwood oil purchased over the Internet from a site promoting the toxic product as an herbal remedy); Russell Watson, The Globe is Gaga for Viagra, (last visited on Nov. 6, 1999) 〈www.newsweek.com/nw-srv/issue/25_98a/printed/us/in0325.htm〉 (describing a lucrative Internet-based black market in products - including flour and corn starch - falsely promoted as "Viagra").
4. Id. at Discussion Group 3, Comments of Dr. Allen Douma, Medical Director and CEO of Health Response Ability Systems ("[I]t is the wild frontier."). See also id., Comments of Lee Peeler, Associate Director for the Division of Advertising Practices, Federal Trade Commission (FTC) ("It is like the wild, wild west out there."). Typical promotions on the Internet today include those for unapproved devices, dangerous herbal remedies and counterfeit drugs. See, e.g., Carl T. Hall, HIV Do-It-Yourself Test Kits Worry U.S. Health Experts, S.F. CHRON., Jan. 13, 1999, at A1; Amy Smith, Medical Advice From Internet May Be Unsafe, KNOXVILLE NEWS-SENTINEL, Jan. 26, 1998 (describing a consumer's acute kidney failure after he ingested wormwood oil purchased over the Internet from a site promoting the toxic product as an herbal remedy); Russell Watson, The Globe is Gaga for Viagra, (last visited on Nov. 6, 1999) 〈www.newsweek.com/nw-srv/issue/25_98a/printed/us/in0325.htm〉 (describing a lucrative Internet-based black market in products - including flour and corn starch - falsely promoted as "Viagra").
5. See, e.g., FOOD & DRUG LAW: CASES & MATERIALS (Peter B. Hutt & Richard A. Merrill, eds., 1991), at 1, 8; James C. Munch, A Half-Century of Drug Control, 11 FOOD DRUG COSM. L.J. 305 (1956), reprinted in FOOD & DRUG LAW, at 379.
6. See, e.g., FOOD & DRUG LAW: CASES & MATERIALS (Peter B. Hutt & Richard A. Merrill, eds., 1991), at 1, 8; James C. Munch, A Half-Century of Drug Control, 11 FOOD DRUG COSM. L.J. 305 (1956), reprinted in FOOD & DRUG LAW, at 379.
7. See F-D-C REP., Internet Advertising. See also Promotion of FDA-Regulated Medical Products on the Internet, Notice of Public Meeting, 61 Fed. Reg. 48, 707 (Sept. 16, 1996).
8. This article will use the term "drug" throughout, however, the analysis is intended to apply not only to drugs, but also to medical devices and other products currently regulated by FDA.
9. The system was not designed for commercial purposes; its architects aimed to construct an information infrastructure capable of surviving a nuclear attack. For a concise history of the development and transformation of the Internet, see David W. Opderbeck, How Should FDA Regulate Prescription Drug Promotion on the Internet?, 53 FOOD & DRUG L.J. 47 (1998).
10. See id.
11. One typical unscrupulous site promoted home abortion kits capable of causing heavy internal bleeding, damage to reproductive organs, and death. See FDA Talk Paper, FDA Warns Consumers on Dangerous Products Promoted on the Internet (June 17, 1997). Although no longer available on the Web, the site stated that its product was a "[c]omplete kit for early pregnancy termination without surgery. Scientifically proven safe and unrisky [sic] . . . [t]he kit combines two common FDA approved medicines for treatment of rheumatoid arthritis, cancer and to prevent [sic] gastric ulcer produced by AINES." Resolve Easy Website 〈www.resolveeasy.com〉 (last updated Mar. 26, 1997).
12. See, e.g., Peter S. Reichertz, Legal Issues Concerning the Promotion of Pharmaceutical Products on the Internet to Consumers, 51 FOOD & DRUG L.J. 355 (1996) [hereinafter Reichertz, Legal Issues].
13. See, e.g., Peter S. Reichertz, Understanding Government Regulation of the Marketing and Advertising of Medical Devices, Drugs, and Biologics: The Challenges of the Internet, 52 FOOD & DRUG L.J. 303 (1997) [hereinafter Reichertz, Challenges of the Internet] (reiterating the initial call for guidance). Guidance had not been issued as of November 4, 1999. Telephone Interview with Melissa Moncavage, CDER (Nov. 4, 1999).
14. FDA's recently enacted mission statement provides explicitly that the agency is to promote public health by taking appropriate and timely action on the marketing of regulated products. See Food and Drug Administration Modernization Act, Pub. L. No. 105-115, § 903(b), 111 Stat. 2296 (1997).
15. Pub. L. No. 75-717, 52 Stat. 1040 (1938) (codified at 21 U.S.C. §§ 301 et seq. (1994)).
16. See 21 U.S.C. § 321(n).
17. See id. § 331(b).
18. Short of regulation, the threat of product liability may provide some incentive for manufacturers to provide information. See, e.g., Marilyn A. Moberg, James W. Wood & Howard L. Dorfman, Surfing the Net in Shallow Waters: Product Liability Concerns and Advertising on the Internet, 53 FOOD & DRUG L.J. 213, 219 (1998) (arguing that providing information might actually increase liability by undermining the "learned intermediary doctrine" which obligates prescribing physicians, rather than manufacturers, to provide additional information). See also Opderbeck, supra note 6, at 63 (arguing that on the Internet liability is unlikely to affect small operators who, if threatened by a lawsuit, "might disappear into cyberspace without a trace and without collectible assets.").
19. Because information is not depleted when used, consumers often will be able to "free ride," or use information they value without paying for it, and difficulty in charging consumers will lead manufacturers to under-provide information. See, e.g., Federal Trade Commission, Comments of the Staff of the Bureau of Consumer Protection & the Bureau of Economics of the Federal Trade Commission, In the Matter of Direct-to-Consumer Promotion: Public Hearing (Jan. 11, 1996).
20. See J. Howard Beales, III, FDA Regulation of Pharmaceutical Advertising: An Economic Analysis, 24 SETON HALL L. REV. 1370 (1994). Manufacturers may exploit this fact by providing false information. See, e.g., Internet Conference, supra note 1, at Presentations, Comments of Lee Peeler, Associate Director for the Division of Advertising Practices at the FTC ("[C]heap, user-friendly software now enables even computer novices to create professional-looking homepages. The potential for deception, with its attendant risks to public health in the case of prescription drugs, is too great simply to allow the Internet to police itself in this area.").
21. In a survey of medical sites on the Web, FDA found that most product information used technical language suited to health care professionals, not patients. See Notice of Public Meeting, supra note 4, at 48,709.
22. See Internet Conference, supra note I, at Opening Remarks of William B. Schultz.
23. Id.
24. For a description of the issues addressed in the 1996 FDA Internet Conference, see generally Marc J. Scheineson, Legal Overview of Likely FDA Regulation of Internet Promotion, 51 FOOD & DRUG L.J. 697 (1996).
25. The agency issued its first warning letter prior to the Internet Conference. See SPOTLIGHT ON FOREIGN COMPANIES, U.S. MEDICAL WEB PAGE PROMO, WARNING LETTER BULLETIN (July 1, 1996). FDA has continued to initiate enforcement actions, targeting large corporations, small companies, and individuals. For example, the large pharmaceutical manufacturer, Merck, received a warning in response to a misleading news report on its website. See, e.g., F-D-C REP. ("The Pink Sheet"), Jan. 4, 1999, at 61(1). A small mail order company, Medications Express, received a letter challenging its practice of helping customers illegally import prescription drugs from Mexico. See Mike Schwartz, Sun City Firm Closes Web Site After Getting Letter From FDA, PRESS ENTERPRISE, Nov. 29, 1998, A-section. An individual physician received a warning for his website promoting an unapproved muscular dystrophy treatment as safe and effective. See Dateline NBC, Profile: One Step at a Time: Experimental Treatment for Muscular Dystrophy, (NBC television broadcast, Dec. 28, 1998).
26. The agency issued its first warning letter prior to the Internet Conference. See SPOTLIGHT ON FOREIGN COMPANIES, U.S. MEDICAL WEB PAGE PROMO, WARNING LETTER BULLETIN (July 1, 1996). FDA has continued to initiate enforcement actions, targeting large corporations, small companies, and individuals. For example, the large pharmaceutical manufacturer, Merck, received a warning in response to a misleading news report on its website. See, e.g., F-D-C REP. ("The Pink Sheet"), Jan. 4, 1999, at 61(1). A small mail order company, Medications Express, received a letter challenging its practice of helping customers illegally import prescription drugs from Mexico. See Mike Schwartz, Sun City Firm Closes Web Site After Getting Letter From FDA, PRESS ENTERPRISE, Nov. 29, 1998, A-section. An individual physician received a warning for his website promoting an unapproved muscular dystrophy treatment as safe and effective. See Dateline NBC, Profile: One Step at a Time: Experimental Treatment for Muscular Dystrophy, (NBC television broadcast, Dec. 28, 1998).
27. The agency issued its first warning letter prior to the Internet Conference. See SPOTLIGHT ON FOREIGN COMPANIES, U.S. MEDICAL WEB PAGE PROMO, WARNING LETTER BULLETIN (July 1, 1996). FDA has continued to initiate enforcement actions, targeting large corporations, small companies, and individuals. For example, the large pharmaceutical manufacturer, Merck, received a warning in response to a misleading news report on its website. See, e.g., F-D-C REP. ("The Pink Sheet"), Jan. 4, 1999, at 61(1). A small mail order company, Medications Express, received a letter challenging its practice of helping customers illegally import prescription drugs from Mexico. See Mike Schwartz, Sun City Firm Closes Web Site After Getting Letter From FDA, PRESS ENTERPRISE, Nov. 29, 1998, A-section. An individual physician received a warning for his website promoting an unapproved muscular dystrophy treatment as safe and effective. See Dateline NBC, Profile: One Step at a Time: Experimental Treatment for Muscular Dystrophy, (NBC television broadcast, Dec. 28, 1998).
28. The agency issued its first warning letter prior to the Internet Conference. See SPOTLIGHT ON FOREIGN COMPANIES, U.S. MEDICAL WEB PAGE PROMO, WARNING LETTER BULLETIN (July 1, 1996). FDA has continued to initiate enforcement actions, targeting large corporations, small companies, and individuals. For example, the large pharmaceutical manufacturer, Merck, received a warning in response to a misleading news report on its website. See, e.g., F-D-C REP. ("The Pink Sheet"), Jan. 4, 1999, at 61(1). A small mail order company, Medications Express, received a letter challenging its practice of helping customers illegally import prescription drugs from Mexico. See Mike Schwartz, Sun City Firm Closes Web Site After Getting Letter From FDA, PRESS ENTERPRISE, Nov. 29, 1998, A-section. An individual physician received a warning for his website promoting an unapproved muscular dystrophy treatment as safe and effective. See Dateline NBC, Profile: One Step at a Time: Experimental Treatment for Muscular Dystrophy, (NBC television broadcast, Dec. 28, 1998).
29. See Kristen Green, Note, Marketing Health Care Products on the Internet: A Proposal for Updated Federal Regulations, 24 AM. J.L. & MED. 365, 373-74 (1998).
30. Merck, for example responded to the FDA warning by stating that its violation had been "inadvertent," and removed the offending promotion from its site. See F-D-C REP., Jan. 4, 1999, supra note 22, at 29. The physician warned about promoting his unapproved muscular dystrophy treatment, likewise, apologized for the transgression and corrected his website. See Dateline NBC, One Step at a Time, supra note 22.
31. Merck, for example responded to the FDA warning by stating that its violation had been "inadvertent," and removed the offending promotion from its site. See F-D-C REP., Jan. 4, 1999, supra note 22, at 29. The physician warned about promoting his unapproved muscular dystrophy treatment, likewise, apologized for the transgression and corrected his website. See Dateline NBC, One Step at a Time, supra note 22.
32. Occasionally, however, promoters have proven less compliant with FDA demands. See, e.g., Schwartz, Firm Closes Web Site, supra note 22 (quoting the president of challenged company as stating that, although he had taken down his website, "I'm just servicing it. . . . It will be back up in a few weeks.").
33. See, e.g., Herbal Dietary Supplement Internet Disease Claims Get Scrutiny, FOOD LABELING NEWS Nov. 11, 1998, at 7(5).
34. The sweep reviewed 1200 Internet sites for deceptive claims regarding the treatment, cure, or prevention of six specific diseases: arthritis, cancer, diabetes, heart disease, HIV/AIDS, and multiple sclerosis. See id.
35. See Reichertz, Challenges of the Internet, supra note 10, at 307.
36. See, Green supra note 23, at 1 ("[M]any drug and medical device makers remain inactive waiting for the FDA and FTC to establish guidelines for Internet marketing."). But see Nancy K. Plant, Prescription Drug Promotion on the Internet: Tool for the Inquisitive or Trap for the Unwary? 42 ST. LOUIS. U. L.J. 89, 104 (1998) (noting that most drug and device manufacturers already have moved online).
37. Worldwide use of the Internet is expected to grow to 233,000,000 by the year 2000. See Hall, supra note 2, at A1.
38. See DTC Internet Ads Tied to Medical Institutions Can "Jump Start" Campaign, F-D-C REP. ("The Pink Sheet"), Dec. 21, 1998, at 60(51).
39. See, e.g., Notice of Public Meeting, supra note 4 (stating possible need for guidance); Peer-Reviewed Studies Presumed "Sound" For Off-Label Dissemination, F-D-C REP. ("The Pink Sheet"), Nov. 23, 1998, at 60(47) (stating that the agency is preparing a guidance document regarding Internet promotions).
40. See, e.g., Notice of Public Meeting, supra note 4 (stating possible need for guidance); Peer-Reviewed Studies Presumed "Sound" For Off-Label Dissemination, F-D-C REP. ("The Pink Sheet"), Nov. 23, 1998, at 60(47) (stating that the agency is preparing a guidance document regarding Internet promotions).
41. See FOOD & DRUG LAW, supra note 3, at 599. See also Memorandum of Understanding, 36 Fed. Reg. 18,538 (Sept. 9, 1971). Under the 1976 Medical Device Amendments, FDA also regulates promotion of restricted medical devices. Pub. L. No. 94-295, 90 Stat. 539.
42. See FOOD & DRUG LAW, supra note 3, at 599. See also Memorandum of Understanding, 36 Fed. Reg. 18,538 (Sept. 9, 1971). Under the 1976 Medical Device Amendments, FDA also regulates promotion of restricted medical devices. Pub. L. No. 94-295, 90 Stat. 539.
43. See FOOD & DRUG LAW, supra note 3, at 599. See also Memorandum of Understanding, 36 Fed. Reg. 18,538 (Sept. 9, 1971). Under the 1976 Medical Device Amendments, FDA also regulates promotion of restricted medical devices. Pub. L. No. 94-295, 90 Stat. 539.
44. See 21 U.S.C. § 502(n) (Drug Amendments of 1962). Later, in the Vitamin-Mineral Amendments of 1976, Congress transferred to FDA responsibility for advertising of vitamins and minerals. See id. § 403(a)(2) and § 707 (Vitamin-Mineral Amendments of 1976).
45. See, e.g., Moberg, Wood & Dorfman, supra note 15, at 217 ("As a hybrid of print and electronic communication, Internet-provided information about a pharmaceutical or medical device on the Internet is likely to be subject to regulations that apply to either. . . ."); Opderbeck, supra note 6, at 56-57; Scheineson, supra note 21, at 705-06.
46. For example, Melissa Moncavage of the FDA's Division of Drug Marketing, Advertising and Communications (DDMAC) stated, "For now, we're letting drug companies choose whatever category of current regulations they think best fits their presence on the Internet." Drug Ads Casting Wider Net, Finding a New Home on the Web, AM. MED. NEWS, Nov. 20, 1995, at 3, cited in Reichertz, Legal Issues, supra note 9, at 357. But see Device Information on the Internet Likely Constitutes Labeling, M-D-D-I REP. ("The Gray Sheet"), July 15, 1996, at I&W5-6 (statement of Byron Tart that device information on the Internet "likely" constitutes labeling). See also FDA ADVERTISING & PROMOTION MANUAL § 637 (1997) (indicating that company homepages are "more like labeling" and information found elsewhere is more likely to be treated as "advertising").
47. For example, Melissa Moncavage of the FDA's Division of Drug Marketing, Advertising and Communications (DDMAC) stated, "For now, we're letting drug companies choose whatever category of current regulations they think best fits their presence on the Internet." Drug Ads Casting Wider Net, Finding a New Home on the Web, AM. MED. NEWS, Nov. 20, 1995, at 3, cited in Reichertz, Legal Issues, supra note 9, at 357. But see Device Information on the Internet Likely Constitutes Labeling, M-D-D-I REP. ("The Gray Sheet"), July 15, 1996, at I&W5-6 (statement of Byron Tart that device information on the Internet "likely" constitutes labeling). See also FDA ADVERTISING & PROMOTION MANUAL § 637 (1997) (indicating that company homepages are "more like labeling" and information found elsewhere is more likely to be treated as "advertising").
48. For example, Melissa Moncavage of the FDA's Division of Drug Marketing, Advertising and Communications (DDMAC) stated, "For now, we're letting drug companies choose whatever category of current regulations they think best fits their presence on the Internet." Drug Ads Casting Wider Net, Finding a New Home on the Web, AM. MED. NEWS, Nov. 20, 1995, at 3, cited in Reichertz, Legal Issues, supra note 9, at 357. But see Device Information on the Internet Likely Constitutes Labeling, M-D-D-I REP. ("The Gray Sheet"), July 15, 1996, at I&W5-6 (statement of Byron Tart that device information on the Internet "likely" constitutes labeling). See also FDA ADVERTISING & PROMOTION MANUAL § 637 (1997) (indicating that company homepages are "more like labeling" and information found elsewhere is more likely to be treated as "advertising").
49. 21 C.F.R. § 201(1)(1) (1996).
50. See Internet Conference, supra note 1, at Discussion Group 3, Comments of Jim Czaban, attorney at Venable, Baetjer, Howard, and Civiletti ("The FDA has a regulation . . . 21 C.F.R. § 202(1)(1), that I thought would have resolved the question. . . . [T]he Internet is a telephone communication system. . . .").
51. See id. at Discussion Group 3, Comments of Mark Boulding ("There are a lot of companies, I think, that would prefer to be regulated by the FTC in their advertising.").
52. See FDA-FTC Memorandum of Understanding, 36 Fed. Reg. 18,539 (Sept. 16, 1971).
53. For example, FDA's "brief summary" requirements obliging manufacturers to print a short statement describing warnings and contraindications in conjunction with an ad was developed in the context of space constraints that do not exist on the Internet. See 21 C.F.R. §§ 202.1(d)(3)-(4).
54. Id. § 321(m).
55. See generally FOOD & DRUG LAW, supra note 3, at 36-83.
56. 335 U.S. 345 (1948).
57. Kordel v. United States, 335 U.S. 345, 351 (1948).
58. Id. at 349.
59. Id. at 350.
60. See, e.g., Guidance to Industry on Dissemination of Reprints of Certain Published, Original Data, 61 Fed. Reg. 52,800 (Oct. 8, 1996); Guidance for Industry Funded Dissemination of Reference Texts, 61 Fed. Reg. 52,800 (Oct. 8, 1996).
61. See, e.g., Guidance to Industry on Dissemination of Reprints of Certain Published, Original Data, 61 Fed. Reg. 52,800 (Oct. 8, 1996); Guidance for Industry Funded Dissemination of Reference Texts, 61 Fed. Reg. 52,800 (Oct. 8, 1996).
62. This approach is used by CDRH within FDA. FDA ADVERTISING & PROMOTION MANUAL, supra note 35, § 637.
63. At least one court found clear support for an informational floor. Alberty Food Prods. Co. v. United States, 185 F.2d 321 (9th Cir. 1950) (holding that consumers "are at least entitled to a chance to somewhere find and examine a 'label' which is complete enough to give them information which would lead them to purchase a drug for that purpose."). Commentators, too, have argued that full information should be available in at least one place on the Internet. See Internet Conference, supra note 1, at Discussion Group 3, Comments of Tim Fallon, Director for Medscape ("If you go to a [search engine] and run a couple of searches and look at the sources for the information that are currently driving the information to consumers, it can almost make an argument that it is more irresponsible not to have an official presence with full disclosure information on the Internet.").
64. As noted above, if promotions are misleading, the product so promoted will be found to be "misbranded" and, hence, prohibited under the FDCA. See 21 U.S.C. §§ 331(b), 321(n).
65. See, e.g., United States v. Article Consisting of 216 Cartoned Bottles . . . "Sudden Change", 409 F.2d 734 (2d Cir. 1969) (Law should protect "the ignorant, the unthinking and the credulous."). But see United States v. 88 Cases . . . Bireley's Orange Beverage, 187 F.2d 967 (3d Cir. 1951) ("The correct standard was the reaction of the ordinary consumer . . . who is neither savant nor dolt.").
66. See Internet Conference, supra note 1, at Comments of Al Rusch, Special Counsel, Division of Enforcement, Securities and Exchange Commission (SEC) (noting that the SEC requires only such disclosures as "a reasonable investor would consider important in whether to buy or sell a particular security. Obviously, you can translate that into the context of a reasonable patient."). See also id. at Comments of David Vance, attorney for Glaxo Wellcome ("We can't protect the idiot and I hope we won't . . . dumb down to the lowest common denominator.").
67. Working against a looser standard, FDA traditionally has been skeptical of drug company efforts to market prescription drugs directly to consumers. See, e.g., Minnie Baylor-Henry, Acting Director, Div. Of Drug Marketing, Advertising, and Communications, CDER, FDA, Speech at the Food and Drug Law Institute's seminar, Marketing and Advertising of Drugs, Medical Devices, and Biologics in a New Environment (Sept. 7, 1995), printed in Reichertz, Legal Issues, supra note 9, at 358. The Internet is in fact one of the fastest growing forms of direct-to-consumer (DTC) advertising. See F-D-C REP., Internet Ads Can Jump Start Campaign, supra note 30, at 23. For additional information on the rapid expansion of DTC marketing, see Rachel X. Weissman, But First Call Your Drug Company, 20 AM. DEMOGRAPHICS 10 (Oct. 1, 1998).
68. Working against a looser standard, FDA traditionally has been skeptical of drug company efforts to market prescription drugs directly to consumers. See, e.g., Minnie Baylor-Henry, Acting Director, Div. Of Drug Marketing, Advertising, and Communications, CDER, FDA, Speech at the Food and Drug Law Institute's seminar, Marketing and Advertising of Drugs, Medical Devices, and Biologics in a New Environment (Sept. 7, 1995), printed in Reichertz, Legal Issues, supra note 9, at 358. The Internet is in fact one of the fastest growing forms of direct-to-consumer (DTC) advertising. See F-D-C REP., Internet Ads Can Jump Start Campaign, supra note 30, at 23. For additional information on the rapid expansion of DTC marketing, see Rachel X. Weissman, But First Call Your Drug Company, 20 AM. DEMOGRAPHICS 10 (Oct. 1, 1998).
69. Working against a looser standard, FDA traditionally has been skeptical of drug company efforts to market prescription drugs directly to consumers. See, e.g., Minnie Baylor-Henry, Acting Director, Div. Of Drug Marketing, Advertising, and Communications, CDER, FDA, Speech at the Food and Drug Law Institute's seminar, Marketing and Advertising of Drugs, Medical Devices, and Biologics in a New Environment (Sept. 7, 1995), printed in Reichertz, Legal Issues, supra note 9, at 358. The Internet is in fact one of the fastest growing forms of direct-to-consumer (DTC) advertising. See F-D-C REP., Internet Ads Can Jump Start Campaign, supra note 30, at 23. For additional information on the rapid expansion of DTC marketing, see Rachel X. Weissman, But First Call Your Drug Company, 20 AM. DEMOGRAPHICS 10 (Oct. 1, 1998).
70. See, e.g., Internet Conference, supra note 1, at Presentations, Comments of Lee Peeler, Associate Director for the Division of Advertising Practices at the Federal Trade Commission.
71. See Opderbeck, supra note 6, at 60-61.
72. Id.
73. See, e.g., Internet Conference, supra note 1, at Discussion Group 1, Comments of Lou Morris, Branch Chief for the Marketing Practices and Communications Branch in CDER ("I guess one of the differences between searching through a medical journal and looking through the Internet is when I'm searching through a medical journal and I see an advertisement, it looks like an advertisement. When I click on the Internet, I don't know where I am. . . .").
74. See id. at Discussion Group 1, Comments of Janis Kelly, medical journalist ("I think . . . funding for studies should be identified."). See also id. Comments of Mr. Whitaker (noting that, with respect to postings of clinical trials, "patients are likely to see that as just factual information when, in fact, on our site those are paid ads."); Id. at Discussion Group 4, Comments of Dr. Sara Stein, clinical research psychiatrist at Stanford University ("[S]earch engines have begun to sell a place in the list. . . . The first ten hits you get on any search there have been paid for. . . ."); F-D-C REP., Internet Ads Can Jump Start Campaign, supra note 30 (noting that by purchasing links on sites sponsored by reputable medical institutions, manufacturers can create in consumers' minds an image of "reliability and trustworthiness").
75. If regulators choose a more expansive monitoring duty, the scope of that duty could range from simply ensuring that sites are not altered by hackers to requirements that manufacturers actively correct outdated information on their sites or even monitor the veracity of information posted on sites to which they link. See Moberg, Wood & Dorfman, supra note 15, at 223.
76. See, e.g., White House, A Framework for Global Electronic Commerce, available at 〈www.whitehouse.gov/WH/New/Commerce/read.html〉 (noting that the Internet, "facilitates the collection, reuse, and instantaneous transmission of information [and] can, if not managed carefully, diminish personal privacy.").
77. Many health-related sites solicit fairly extensive personal information from visitors. For example, the pharmaceutical manufacturer Zeneca offers a $5 rebate on its migraine treatment to patients who provide it with personal data by completing a survey See F-D-C REP., Internet Ads Can "Jump Start" Campaign, supra note 30, at 23.
78. Glaxo Wellcome, for example, offers a clearly labeled link to a detailed privacy policy. See Glaxo Wellcome Inc. Internet Privacy Statement (visited on Jan. 18, 1999) 〈www.imgw.com/privacy.htm〉. Another large manufacturer, Merck, also offers information about its privacy policy, though it does so through a link stating, "Confused by cookies?" See Merck Homepage (visited on Jan. 18, 1999) 〈www.merck.com〉. Smaller manufacturers, by contrast, seldom post privacy policies at all. See, e.g., HIVhometest Homepage,(visited Jan. 26, 1999) 〈www.hivhometest.com〉.
79. Glaxo Wellcome, for example, offers a clearly labeled link to a detailed privacy policy. See Glaxo Wellcome Inc. Internet Privacy Statement (visited on Jan. 18, 1999) 〈www.imgw.com/privacy.htm〉. Another large manufacturer, Merck, also offers information about its privacy policy, though it does so through a link stating, "Confused by cookies?" See Merck Homepage (visited on Jan. 18, 1999) 〈www.merck.com〉. Smaller manufacturers, by contrast, seldom post privacy policies at all. See, e.g., HIVhometest Homepage,(visited Jan. 26, 1999) 〈www.hivhometest.com〉.
80. Glaxo Wellcome, for example, offers a clearly labeled link to a detailed privacy policy. See Glaxo Wellcome Inc. Internet Privacy Statement (visited on Jan. 18, 1999) 〈www.imgw.com/privacy.htm〉. Another large manufacturer, Merck, also offers information about its privacy policy, though it does so through a link stating, "Confused by cookies?" See Merck Homepage (visited on Jan. 18, 1999) 〈www.merck.com〉. Smaller manufacturers, by contrast, seldom post privacy policies at all. See, e.g., HIVhometest Homepage,(visited Jan. 26, 1999) 〈www.hivhometest.com〉.
81. 21 U.S.C. § 502(f).
82. 21 C.F.R. § 201.5.
83. 21 U.S.C. § 352(n); 21 C.F.R. § 202.1(e)(5)(ii). Even where advertising space is limited, the Act requires a brief summary of the indications, contraindications, side effects and warnings for use of the product. 21 U.S.C. § 352(n).
84. In its initial Federal Register notice announcing the 1996 meeting, FDA queried "should 'fair balance' be considered in the presentation of information on every screen? In every advertisement or promotional piece? Or on the entire website?" Notice of Public Meeting, supra note 4, at 47,809.
85. See, e.g., Internet Conference, supra note 1, at Discussion Group 3, Comments of Phil McKee, National Consumers League. FDA, however, has indicated that a reference to full prescribing information may be insufficient to constitute fair balance in an Internet promotion. See Ronald M. Schwartz, FDA Issues Warning on Wayward Website, AM. DRUGGIST, Feb. 1997, available in WL 7972051. See also DDMAC UNTITLED LETTERS, WARNING LETTER BULLETIN, Nov. 23, 1998 (warning a manufacturer that a hypertext link to risk information was not sufficient to provide fair balance.) Presumably, the agency fears that consumers will fail to follow links and thus will miss detailed risk information if it is provided only through a link rather than directly on the homepage.
86. See, e.g., Internet Conference, supra note 1, at Discussion Group 3, Comments of Phil McKee, National Consumers League. FDA, however, has indicated that a reference to full prescribing information may be insufficient to constitute fair balance in an Internet promotion. See Ronald M. Schwartz, FDA Issues Warning on Wayward Website, AM. DRUGGIST, Feb. 1997, available in WL 7972051. See also DDMAC UNTITLED LETTERS, WARNING LETTER BULLETIN, Nov. 23, 1998 (warning a manufacturer that a hypertext link to risk information was not sufficient to provide fair balance.) Presumably, the agency fears that consumers will fail to follow links and thus will miss detailed risk information if it is provided only through a link rather than directly on the homepage.
87. See, e.g., Internet Conference, supra note 1, at Discussion Group 3, Comments of Phil McKee, National Consumers League. FDA, however, has indicated that a reference to full prescribing information may be insufficient to constitute fair balance in an Internet promotion. See Ronald M. Schwartz, FDA Issues Warning on Wayward Website, AM. DRUGGIST, Feb. 1997, available in WL 7972051. See also DDMAC UNTITLED LETTERS, WARNING LETTER BULLETIN, Nov. 23, 1998 (warning a manufacturer that a hypertext link to risk information was not sufficient to provide fair balance.) Presumably, the agency fears that consumers will fail to follow links and thus will miss detailed risk information if it is provided only through a link rather than directly on the homepage.
88. In the 1962 amendments to the FDCA, Congress amended the definition of "new drug" to clarify that all drugs must be proven safe and effective for a particular use. See 21 U.S.C. § 321(p).
89. Off-label uses include "treating a condition not indicated on the label, or treating the indicated condition but varying the dosing regimen or the patient population." Washington Legal Found. v. Friedman, 13 F. Supp. 2d 51, 55 (D.D.C. 1998). The court in Friedman noted that "[f]or a manufacturer to promote its product for off-label use without gaining the necessary approval constitutes misbranding, and is prohibited. See 21 U.S.C. §§ 352, 331(b)." Id.
90. For example, anti-arrhythmic drugs, once commonly prescribed off-label for heart attack survivors with a high rate of ventricular premature beats, later were found to increase mortality in those patients. FDA cites this and other cases in which health care professionals assumed an approved drug would work for additional uses, only to be proven wrong by later clinical testing, in a 1994 Federal Register notice. 59 Fed. Reg. 59,820, 59,825 (1994) See also Schering Inron A and Genentech Pulmozyme Supplemental Applications Illustrate Importance of Clinical Evaluation of Off-Label Uses, F-D-C REP. ("The Pink Sheet"), Feb. 26, 1996, at 6.
91. For example, anti-arrhythmic drugs, once commonly prescribed off-label for heart attack survivors with a high rate of ventricular premature beats, later were found to increase mortality in those patients. FDA cites this and other cases in which health care professionals assumed an approved drug would work for additional uses, only to be proven wrong by later clinical testing, in a 1994 Federal Register notice. 59 Fed. Reg. 59,820, 59,825 (1994) See also Schering Inron A and Genentech Pulmozyme Supplemental Applications Illustrate Importance of Clinical Evaluation of Off-Label Uses, F-D-C REP. ("The Pink Sheet"), Feb. 26, 1996, at 6.
92. 59 Fed. Reg. 59,820, 59,825 (1994); Apr. 1997 Hearing (comments of FDA officials Michael Friedman and William Schultz); Testimony of Michael Friedman, Deputy Commissioner for Operations, Food and Drug Administration, Department of Health and Human Services, House Government Reform and Oversight, Human Resources and Intergovernmental Relations, Fed. Doc. Clearing House, Inc., Sept. 12, 1996, available in LEXIS; The FDA in the Senate, WASH. POST, July 23, 1997, at A22; Rep. Burr Drugs/Biologics Reform Bill Drops Information Dissemination Provisions; AAP Opposes Off-Label Promotion of Pediatric Information by Sponsors, F-D-C REP. ("The Pink Sheet"), Apr. 18, 1997, at 8; Trade & Gov't Memos, F-D-C REP. ("The Pink Sheet"), Sept. 9, 1996, at T&G-1.
93. 59 Fed. Reg. 59,820, 59,825 (1994); Apr. 1997 Hearing (comments of FDA officials Michael Friedman and William Schultz); Testimony of Michael Friedman, Deputy Commissioner for Operations, Food and Drug Administration, Department of Health and Human Services, House Government Reform and Oversight, Human Resources and Intergovernmental Relations, Fed. Doc. Clearing House, Inc., Sept. 12, 1996, available in LEXIS; The FDA in the Senate, WASH. POST, July 23, 1997, at A22; Rep. Burr Drugs/Biologics Reform Bill Drops Information Dissemination Provisions; AAP Opposes Off-Label Promotion of Pediatric Information by Sponsors, F-D-C REP. ("The Pink Sheet"), Apr. 18, 1997, at 8; Trade & Gov't Memos, F-D-C REP. ("The Pink Sheet"), Sept. 9, 1996, at T&G-1.
94. 59 Fed. Reg. 59,820, 59,825 (1994); Apr. 1997 Hearing (comments of FDA officials Michael Friedman and William Schultz); Testimony of Michael Friedman, Deputy Commissioner for Operations, Food and Drug Administration, Department of Health and Human Services, House Government Reform and Oversight, Human Resources and Intergovernmental Relations, Fed. Doc. Clearing House, Inc., Sept. 12, 1996, available in LEXIS; The FDA in the Senate, WASH. POST, July 23, 1997, at A22; Rep. Burr Drugs/Biologics Reform Bill Drops Information Dissemination Provisions; AAP Opposes Off-Label Promotion of Pediatric Information by Sponsors, F-D-C REP. ("The Pink Sheet"), Apr. 18, 1997, at 8; Trade & Gov't Memos, F-D-C REP. ("The Pink Sheet"), Sept. 9, 1996, at T&G-1.
95. 59 Fed. Reg. 59,820, 59,825 (1994); Apr. 1997 Hearing (comments of FDA officials Michael Friedman and William Schultz); Testimony of Michael Friedman, Deputy Commissioner for Operations, Food and Drug Administration, Department of Health and Human Services, House Government Reform and Oversight, Human Resources and Intergovernmental Relations, Fed. Doc. Clearing House, Inc., Sept. 12, 1996, available in LEXIS; The FDA in the Senate, WASH. POST, July 23, 1997, at A22; Rep. Burr Drugs/Biologics Reform Bill Drops Information Dissemination Provisions; AAP Opposes Off-Label Promotion of Pediatric Information by Sponsors, F-D-C REP. ("The Pink Sheet"), Apr. 18, 1997, at 8; Trade & Gov't Memos, F-D-C REP. ("The Pink Sheet"), Sept. 9, 1996, at T&G-1.
96. For more information about FDA's problems with unapproved uses of approved drugs, see FOOD & DRUG LAW, supra note 3, at 462-66.
97. For example, FDA cited Palomar Medical Technologies for using its website to promote an off-label use. The agency warned Palomar that, "promotional materials distributed via the Internet are regulated by the Agency in the same manner as materials distributed by other means. . . . If Palomar uses the Internet in the future, you should ensure that promotional claims are limited to the intended uses that were cleared in your 510(k) premarket notification." Warning Letter to Positive Response Television (July 9, 1996), printed in FDA ADVERTISING & PROMOTION MANUAL, App. IV, at C-225.
98. See, e.g., Internet Conference, supra note 1, at Discussion Group 1, Comments of FDA Moderator Wayne Pines ("FDA certainly, while it can control what pharmaceutical companies and medical device companies and biologics companies put on the Internet, really can't control what consumers or what medical researchers independently put on the Internet."); id., Comments of Bill Schultz, FDA Office of Policy (noting that with respect to publication of off-label information by "a medical journal, a patient group, a writer, the rules are very open and we don't really get involved"). See also Opderbeck, supra note 6, at 58.
99. FDA might try to stop manufacturers from linking their sites to sites discussing exclusively off-label information uses. But conceptually, it would be more difficult for the agency to block links to sources like the New England Journal of Medicine, that only occasionally discuss off-label uses and that are available in print in public libraries. Moreover, enforcing a "no links to off-label information" policy would present huge administrative obstacles. Even if the agency could visit and review the complete contents of every site to which a manufacturer linked, it could never review all of the "third-generation sites," accessible through links from the linked site. See, e.g., Internet Ads Can "Jump Start" Campaign, supra note 30, at 23.
100. Internet Conference, supra note 1, at Discussion Group 1, Comments of Janis Kelly, medical journalist. ("I think the idea of restricting access is not only not doable but a mistake in terms of communication and freedom of speech."); id. at Comments of Mario Cavallini, Web designer for medical publisher, Slack, Inc. ("I don't think it is going to be feasible to try and rule out cases, to say thou shalt not, because there are going to be all sorts of people who are going to 'shall' anyway.")
101. Pub. L. No. 105-115, § 401, 111 Stat. 2296.
102. See id. (describing additional conditions manufacturers must fulfill in order to promote off-label uses under this provision).
103. FDA DIVISION OF DRUG MARKETING, ADVERTISING AND COMMUNICATIONS, CURRENT ISSUES AND PROCEDURES 6-7 (1994).
104. See, e.g., Internet Conference, supra note 1, at Discussion Group 1, Comments of Becky Cleavenger, Regulatory Affairs Officer at AMGEN. But see id. at Comments of Janis Kelly, medical journalist.
105. See id. at Discussion Group 4, Comments of Dr. Allen Douma, Medical Director for Health Response Ability Systems ("I want to ask us all . . . why do we, in fact, want to prevent the distribution of off-label information by a certain subset of our society? In this case, it is people, perhaps who have a vested interest and that is our concern. But they also have the best information.").
106. Rachel X. Weissman, But First Call Your Drug Company, (last visited on Nov. 6, 1999) 〈www.demographic.com/Publications/AD/98_ad/9810_ad/ad981008.html〉 (noting that a 1997 study indicated that 54% of consumers think Health Maintenance Organizations are more interested in their bottom lines than they are in their patients' health and arguing that DTC advertising has played a useful role in offsetting high levels of distrust by facilitating increased self-education by patients).
107. A 1998 study by Deloitte & Touche found that 25% of patients had changed physicians within the past two years and the amount of time patients spent with physicians on visits had dropped as well. See id.
108. For example, in loosening the brief summary requirement for broadcast DTC promotions, FDA stated that the summary was unnecessary if the sponsor provides "an effective mechanism by which the majority of a potentially diverse audience can receive the advertised product's approved labeling," including by "(4) [p]roviding an address for an Internet Web page that includes the package insert." Guidance for Industry/Consumer-Directed Broadcast advertisements (visited Jan. 20, 1999) 〈www.fda.gov/cder/guidance/index.htm〉.
109. See, e.g., FTC, In the Matter of Direct-to-Consumer Promotion, supra note 16 ("Truthful and non-misleading advertising can help consumers manage their own health care. Advertisements can, for example, provide timely information regarding medical advances, remind consumers about good health care practices, and supply information needed by consumers to understand and evaluate their physician's recommendations. . . . With the growth of managed care organizations, consumers are expected to become more actively involved in their own health care decisions.").
110. See, e.g., Internet Conference, supra note 1, at Discussion Group 1, Comments of Wendy Borow, President of the media division of Medicus ("Clearly, patients are taking more responsibility for their own healthcare. In the managed care environment in which we live, that is something we should all be encouraging and [the FDA has] a great role to play.").
111. See, e.g., Lee Benham, The Effect of Advertising on the Price of Eyeglasses, 15 J.L. & ECON. 337 (1972); Ronald S. Bond et al., Effects of Restrictions on Advertising and Commercial Practice in the Professions: The Case of Optometry, in FTC BUREAU OF ECONOMICS STAFF REPORT (1980); John R. Scroeter et al., Advertising and Competition in Routine Legal Service Markets: An Empirical Investigation, 36 J. INDUS. ECON. 49 (1987); JOHN F. CADY, RESTRICTED ADVERTISING & COMPETITION: THE CASE OF RETAIL DRUGS (American Enterprise Inst. 1976).
112. See, e.g., Lee Benham, The Effect of Advertising on the Price of Eyeglasses, 15 J.L. & ECON. 337 (1972); Ronald S. Bond et al., Effects of Restrictions on Advertising and Commercial Practice in the Professions: The Case of Optometry, in FTC BUREAU OF ECONOMICS STAFF REPORT (1980); John R. Scroeter et al., Advertising and Competition in Routine Legal Service Markets: An Empirical Investigation, 36 J. INDUS. ECON. 49 (1987); JOHN F. CADY, RESTRICTED ADVERTISING & COMPETITION: THE CASE OF RETAIL DRUGS (American Enterprise Inst. 1976).
113. See, e.g., Lee Benham, The Effect of Advertising on the Price of Eyeglasses, 15 J.L. & ECON. 337 (1972); Ronald S. Bond et al., Effects of Restrictions on Advertising and Commercial Practice in the Professions: The Case of Optometry, in FTC BUREAU OF ECONOMICS STAFF REPORT (1980); John R. Scroeter et al., Advertising and Competition in Routine Legal Service Markets: An Empirical Investigation, 36 J. INDUS. ECON. 49 (1987); JOHN F. CADY, RESTRICTED ADVERTISING & COMPETITION: THE CASE OF RETAIL DRUGS (American Enterprise Inst. 1976).
114. See, e.g., Lee Benham, The Effect of Advertising on the Price of Eyeglasses, 15 J.L. & ECON. 337 (1972); Ronald S. Bond et al., Effects of Restrictions on Advertising and Commercial Practice in the Professions: The Case of Optometry, in FTC BUREAU OF ECONOMICS STAFF REPORT (1980); John R. Scroeter et al., Advertising and Competition in Routine Legal Service Markets: An Empirical Investigation, 36 J. INDUS. ECON. 49 (1987); JOHN F. CADY, RESTRICTED ADVERTISING & COMPETITION: THE CASE OF RETAIL DRUGS (American Enterprise Inst. 1976).
115. For instance, restrictions on DTC advertising initially prevented drug companies from advertising the conditions which their products were intended to treat. As a result, many viewers of an early Claritin® commercial for "a clear day with Claritin®," assumed that the antihistamine was an antidepressant. See Weissman, supra note 82.
116. Most manufacturers have incentives to adhere to FDA guidelines because of their on-going relationship with the agency, their reputation with the public, and their desire to avoid lawsuits down the line. See, e.g., Richard A. Merrill, Symposium on Regulating Medical Innovation: The Architecture of Government Regulation of Medical Products, 82 VA. L. REV. 1753, 1781 (1996) (noting the on-going relationship between FDA and the manufacturers it regulates).
117. See, e.g., Internet Conference, supra note 1, at Comments of Dan McKillen, Moderator (noting with respect to consumers' ability to obtain information over the Internet, "[t]hey are going to get it one way or the other. It is just a matter of whether they get it right . . .").
118. U.S. CONST. amend. I.
119. 425 U.S. 748 (1976).
120. Virginia Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 765 (1976) (footnotes omitted).
121. See id. at 770.
122. Id.
123. Id. at 772, n.24.
124. 447 U.S. 557 (1980).
125. Id. at 566.
126. See id.
127. Id.
128. Id.
129. 517 U.S. 484 (1996).
130. 44 Liquormart, 517 U.S. at 495-96 (citing Kozinski & Banner, The
131. 44 Liquormart, 517 U.S. at 512.
132. See id. at 516.
133. Id. at 517 (Scalia, J., concurring).
134. Id. at 518 (Thomas, J., concurring) ("I do not see a philosophical or historical basis for asserting that 'commercial' speech is of 'lower value' than 'noncommercial' speech.").
135. Id. at 528 (O'Connor, J., concurring).
136. See id. at 529.
137. 13 F. Supp. 2d 51 (D.D.C. 1998).
138. See id. at 51 (citing 62 Fed. Reg. 64,074 (Dec. 3, 1997)). The district court noted that the latter guidance would be superseded by statute one year after the effective date of FDAMA.
139. Friedman, 13 F. Supp. 2d at 61.
140. Id. (quoting 44 Liquormart, 517 U.S. at 512, "Any lingering doubt as to whether the government may impose restrictions upon speech without offending the First Amendment merely because it has the authority to regulate the underlying activity was resolved in 44 Liquormart. . . .").
141. Id. at 62.
142. Id. at 64 (drawing the definition of commercial speech from Bolger v. Youngs Drug Prods. Corp., 463 U.S. 60 (1983)). The Bolger test asks, "(1) whether the speech is concededly an advertisement; (2) whether the speech refers to a specific product; and (3) whether the speaker has an economic motivation for disseminating the speech." 463 U.S. at 66.
143. Bolger, 463 U.S. at 67.
144. See supra notes 68-69 and accompanying text.
145. Friedman, 13 F. Supp. 2d at 70 ("[T]he government's notion that the scientific research product which the manufacturers seek to distribute needs to be withheld for the 'good of the recipient' is even more unsupportable than usual. First, it must be noted that the manufacturers are not seeking to distribute this information to the general consumer public, who likely lack the knowledge or sophistication necessary to make informed choices on the efficacy of prescription drugs. . . . Rather, they seek to disseminate this information exclusively to physicians.").
146. See id. at 71 ("Congress has concluded that it benefits the public health to require manufacturers to get all uses approved by [the] FDA . . . and has recently reaffirmed that position through the 1997 Food and Drug Amendments.").
147. Id. at 72.
148. See id. at 72-73.
149. Id. at 73 (internal citations omitted).
150. Id.
151. 164 F.3rd 650 (D.C. Cir. 1999).
152. Id.
153. See id. at 655. ("As best we understand the government, its first argument runs along the following lines: that health claims lacking 'significant scientific agreement' are inherently misleading because they have such an awesome impact on consumers as to make it virtually impossible for them to exercise any judgment at the point of sale. It would be as if the consumers were asked to buy something while hypnotized, and therefore they are bound to be misled. We think this contention is almost frivolous.").
154. Id. at 656 (quoting Rubin v. Coors Brewing Co., 514 U.S. 476, 485 (1995)).
155. Id.
156. Id.
157. Id. at 658.
158. If FDA chooses to regulate rather than suppress the information, it might require, for example, that off-label information be printed under the prominent title, "warning," along with a statement that FDA had not approved the use. FDA also might require disclosure of all studies relating to the off-label use, both favorable and unfavorable, or, at a minimum, links to sites detailing the studies.
159. As noted above, the court in Friedman expressly conditioned its holding on a finding that adequate incentives remained to encourage manufacturers to submit supplemental NDAs. See Friedman, 880 F. Supp. 64, 73 (1998). Arguably, if manufacturers can provide promote off-label uses on the Internet without seeking supplemental approval, incentives to submit supplemental NDAs may be severely undermined. It can also be argued, however, that by permitting or even requiring the provision of information regarding off-label uses in conjunction with mandated warnings, FDA might mandate warnings sufficiently "scary" as to deter more people from using products for unapproved purposes. See, e.g., J.L. Hamilton, The Effect of Cigarette Advertising Bans on Cigarette Consumption, in SMOKING & HEALTH: HEALTH CONSEQUENCES OF EDUCATION, CESSATION ACTIVITIES & GOVERNMENTAL ACTION (J. Steinfeld et al. eds.)(1977) at 829-40 (demonstrating that a shift in regulatory policy to prohibit television and radio cigarette advertising actually increased smoking rates). Hamilton argues that the increase in smoking rates appears to have been attributable to the relatively greater deterrent value of permitting cigarette advertising but requiring that it be accompanied by warnings under "fair balance" requirements.
160. As noted above, the court in Friedman expressly conditioned its holding on a finding that adequate incentives remained to encourage manufacturers to submit supplemental NDAs. See Friedman, 880 F. Supp. 64, 73 (1998). Arguably, if manufacturers can provide promote off-label uses on the Internet without seeking supplemental approval, incentives to submit supplemental NDAs may be severely undermined. It can also be argued, however, that by permitting or even requiring the provision of information regarding off-label uses in conjunction with mandated warnings, FDA might mandate warnings sufficiently "scary" as to deter more people from using products for unapproved purposes. See, e.g., J.L. Hamilton, The Effect of Cigarette Advertising Bans on Cigarette Consumption, in SMOKING & HEALTH: HEALTH CONSEQUENCES OF EDUCATION, CESSATION ACTIVITIES & GOVERNMENTAL ACTION (J. Steinfeld et al. eds.)(1977) at 829-40 (demonstrating that a shift in regulatory policy to prohibit television and radio cigarette advertising actually increased smoking rates). Hamilton argues that the increase in smoking rates appears to have been attributable to the relatively greater deterrent value of permitting cigarette advertising but requiring that it be accompanied by warnings under "fair balance" requirements.
161. See, e.g., White House Briefing, Electronic Commerce: Comments of Vice President Albert Gore, Nov. 30, 1998 ("And in this emerging digital marketplace, nearly anyone with a good idea and a little software can set up shop and then become the corner store for an entire planet. Who would have imagined that someone who simply wanted to find other people who were also interested in collecting Pez candy dispensers would become eBay, one of the fastest-growing companies today. . . .").
162. See generally Internet Conference, supra note 1, at Presentations, Comments of Lee Peeler, Associate Director for the Division of Advertising Practices at the FTC (noting that on the Internet "very small entities can become national advertisers at a very low cost. . . . This loss of the gatekeeper function served by traditional media will be added to by the number of marketers coming into this market that lack familiarity with some of the basics of consumer-protection issues.").
163. See Hall, supra note 2, at A1 (quoting Dr. Helga Rippen, Director of the nonprofit Health Information Technology Institute: "[t]he problem is that many companies are not comfortable using the Internet and may not know how to effectively use it to market and sell their products while complying with FDA rules on advertisements.").
164. Pub. L. No. 103-417, 108 Stat. 4325 (codified at 21 U.S.C. § 301).
165. See, e.g., Public Voice Asks Follow-Up on Dietary Supplement "Drug" Claims Letter, FOOD LABELING NEWS, Nov. 18, 1998 (quoting physician Bob Hoerr: "In the past six months I've seen individuals going from the pharmaceutical or clinical nutrition world ending up as senior research and development employees of dietary supplement companies. . . . In many cases, it's because of opportunity, downsizing and consolidation. . . . But it's also the opportunity for more junior people to make their mark in an area where there's substantial growth.").
166. For typical infractions by an Internet-based dietary supplement marketer, see WARNING LETTER BULLETIN, Oct. 12, 1998 (FDA warning to USA Sports Labs for Web promotion of Herbal Phen-Thin, Herbal Phen-Thin II, Herbal Valium, Herbal PRO-S.A.C., Herbal Aspirin, and Shark Cartilage II. FDA considered the products to be "drugs" and objected to the use of trade names, labeling and catalogue information that the agency considered false and misleading. Additionally, FDA found "Herbal Aspirin" misbranded for its suggested equivalence to aspirin.).
167. See, e.g., Schwartz, Firm Closes Web Site, supra note 22, at A-section (describing discount website operator importing drugs from Mexico without proof that drugs requested had been prescribed or even approved for prescription in the United States). See also Hall, supra note 2, at A1 (describing journalists' purchase of unapproved HIV test kit advertised on the Web: "The test came with an English-language label pasted on top of an original label printed in Russian. The package was shipped from Malta by a European company, Health Diagnostics Ltd., with offices in London, computer equipment in France and a Belgian president, Charles Dupont, who said he was in Monaco when he was interviewed by telephone.").
168. Some companies intentionally may choose to base themselves in foreign nations for these very reasons. See, e.g., Hall, supra note 2, at A1.
169. For example, although Viagra® is approved for prescription use in the United States, it has not been approved in other countries. See Watson, supra note 2.
170. See, e.g., Nutrition-City Website (visited on Jan. 25, 1999) 〈www.nutrition-city.net/〉 (presenting information accessible through "flag links" for Australia, Canada, New Zealand, and the United Kingdom; the flag links do not have accompanying print identifying the country represented).
171. Device Information on Internet Home Pages Likely Constitutes Labeling, M-D-D-I REP. ("The Gray Sheet"), July 15, 1996, at 1W5, cited in Reichertz, Legal Issues, supra note 9, at 360.
172. Device Information on Internet Home Pages Likely Constitutes Labeling, M-D-D-I REP. ("The Gray Sheet"), July 15, 1996, at 1W5, cited in Reichertz, Legal Issues, supra note 9, at 360.
173. Parties will not want to offend FDA, and may hope that by adhering to all issued regulations they will be able to avoid product liability suits. See, e.g., Reichertz, Legal Issues, supra note 9, at 364.
174. The National Advertising Division (NAD) of the Council of Better Business Bureaus already has enforced standards on the Internet. In 1995, for example, the NAD addressed a website sponsored by the Infinity Distribution Company, claiming that its weight lifting aid was "far superior to any product or system ever developed." When the claim could not be substantiated, the NAD forced a settlement with the company under which the company agreed to modify future advertisements to comply with NAD guidelines. See id.
175. Over time, people would learn to recognize FDA's approval and, presumably, would place greater stock in information read on approved sites. See, e.g., Cosmetic Ingredient Labeling, 38 Fed. Reg. 28,912 (Oct. 17, 1973) ("The Commissioner recognizes that many consumers may initially be unfamiliar with certain cosmetic ingredients, but concludes that increasing familiarity will be acquired."). The digital certificate solution, however, has a number of flaws. First, it would involve heavy FDA involvement in development of content on the Internet, seriously impacting freedom of speech. Second, for FDA approval to convey meaningful legitimacy, the agency would have to conduct on-going supervision - a burden far in excess of the agency's reviewing capacity.
176. See, e.g., Green, supra note 23, at 376 (stating that "most medical industry whistleblowers are sales representative from competing firms also subject to FDA regulation."); FDA ADVERTISING & PROMOTION MANUAL MONTHLY BULLETIN, Nov. 1995, at 4, cited in Reichertz, Legal Issues, supra note 9, at 361 (citing an FDA staffer as stating, "Ultimately, the FDA likely will rely heavily on competitor's reports of improper promotional activity on the Internet.").
177. See, e.g., Green, supra note 23, at 376 (stating that "most medical industry whistleblowers are sales representative from competing firms also subject to FDA regulation."); FDA ADVERTISING & PROMOTION MANUAL MONTHLY BULLETIN, Nov. 1995, at 4, cited in Reichertz, Legal Issues, supra note 9, at 361 (citing an FDA staffer as stating, "Ultimately, the FDA likely will rely heavily on competitor's reports of improper promotional activity on the Internet.").
178. See, e.g., Life Plus' Ads for ShapePlus and Endogen Referred to FTC, F-D-C REP. ("The Tan Sheet"), July 22, 1996, at 6-7.
179. The case involved a Internet-assisted pyramid scheme promulgated by Fortuna Alliance, and is described in Green, supra note 23, at 377 (citing Thomas C. Morrison & Robert W. Lehrburger, FTC Targets Deceptive Cyberspace Advertising, NAT'L L.J., Aug. 12, 1996, at B7; 15 U.S.C. §§ 42, 52 (1994)) (noting that the FTC has already prosecuted "a dozen cases involving alleged online scams and false advertising).
180. FDA should sponsor on-going studies monitoring the ways in which consumers use the Internet.
181. Developing studies necessary to support supplemental applications constitutes a large part of the expense. The Tufts Center for the Study of Drug Development estimates that developing data for a supplemental application is in the multi-million dollar range with an upper bound in the ballpark of $312,000,000 - in 1997 dollars. See Letter from Peg Hewitt, Research Librarian, Tufts Center for the Study of Drug Development, Mar. 24, 1999 (on file with author). See also Joseph A. DiMasi, R.W. Hansen, H.G. Grabowski & Louis Lasgana, Cost of Innovation in the Pharmaceutical Industry, 10 J. HEALTH ECON. 107 (1991). Time costs involved in submitting supplemental NDAs also are substantial; between 1989 and 1993, FDA took, on average, ten months longer to approve a supplemental application than it did to approve the original NDA for the same drug. See Louis Lasagna & Joseph A. DiMasi, Let's Speed Up the Approval of New Indications for Old Drugs, MED. MARKETING & MEDIA, Dec. 1996, at 88; Joseph A. DiMasi, Jeffrey S. Brown & Louis Lasagna, An Analysis of Regulatory Review Times of Supplemental Indications for Already-Approved Drugs, 30 DRUG INFO. J. 315 (1996). Longer lags in approval time for supplemental NDAs might seem to be a counterintuitive finding given that the "safety" of FDA's safety and effectiveness concerns is resolved in the agency's approval of the initial use. A partial response is that FDA may be using the supplemental application as an opportunity to review its initial conclusion regarding safety on the basis of subsequently developed data. See John Schwartz, Is FDA Too Quick to Clear Drugs? Growing Recalls, Side Effect Risks Raise Questions, WASH. POST, Mar. 23, 1999, at A1. Preliminary research indicates that the Prescription Drug User Fees Act of 1992 may have decreased the amount of time required for approvals of supplemental applications. See Food and Drug Admin./Dept. of Health and Human Services, Fourth Annual Performance Report/Prescription Drug User Fee Act of 1992/Fiscal Year 1996 Report to Congress 7 (1996). See also Merrill, Symposium on Regulating Medical Innovation, supra note 89, at 1795-96 (citing evidence regarding the effect of PDUFA on review time and costs for new and supplemental applications).
182. Developing studies necessary to support supplemental applications constitutes a large part of the expense. The Tufts Center for the Study of Drug Development estimates that developing data for a supplemental application is in the multi-million dollar range with an upper bound in the ballpark of $312,000,000 - in 1997 dollars. See Letter from Peg Hewitt, Research Librarian, Tufts Center for the Study of Drug Development, Mar. 24, 1999 (on file with author). See also Joseph A. DiMasi, R.W. Hansen, H.G. Grabowski & Louis Lasgana, Cost of Innovation in the Pharmaceutical Industry, 10 J. HEALTH ECON. 107 (1991). Time costs involved in submitting supplemental NDAs also are substantial; between 1989 and 1993, FDA took, on average, ten months longer to approve a supplemental application than it did to approve the original NDA for the same drug. See Louis Lasagna & Joseph A. DiMasi, Let's Speed Up the Approval of New Indications for Old Drugs, MED. MARKETING & MEDIA, Dec. 1996, at 88; Joseph A. DiMasi, Jeffrey S. Brown & Louis Lasagna, An Analysis of Regulatory Review Times of Supplemental Indications for Already-Approved Drugs, 30 DRUG INFO. J. 315 (1996). Longer lags in approval time for supplemental NDAs might seem to be a counterintuitive finding given that the "safety" of FDA's safety and effectiveness concerns is resolved in the agency's approval of the initial use. A partial response is that FDA may be using the supplemental application as an opportunity to review its initial conclusion regarding safety on the basis of subsequently developed data. See John Schwartz, Is FDA Too Quick to Clear Drugs? Growing Recalls, Side Effect Risks Raise Questions, WASH. POST, Mar. 23, 1999, at A1. Preliminary research indicates that the Prescription Drug User Fees Act of 1992 may have decreased the amount of time required for approvals of supplemental applications. See Food and Drug Admin./Dept. of Health and Human Services, Fourth Annual Performance Report/Prescription Drug User Fee Act of 1992/Fiscal Year 1996 Report to Congress 7 (1996). See also Merrill, Symposium on Regulating Medical Innovation, supra note 89, at 1795-96 (citing evidence regarding the effect of PDUFA on review time and costs for new and supplemental applications).
183. Developing studies necessary to support supplemental applications constitutes a large part of the expense. The Tufts Center for the Study of Drug Development estimates that developing data for a supplemental application is in the multi-million dollar range with an upper bound in the ballpark of $312,000,000 - in 1997 dollars. See Letter from Peg Hewitt, Research Librarian, Tufts Center for the Study of Drug Development, Mar. 24, 1999 (on file with author). See also Joseph A. DiMasi, R.W. Hansen, H.G. Grabowski & Louis Lasgana, Cost of Innovation in the Pharmaceutical Industry, 10 J. HEALTH ECON. 107 (1991). Time costs involved in submitting supplemental NDAs also are substantial; between 1989 and 1993, FDA took, on average, ten months longer to approve a supplemental application than it did to approve the original NDA for the same drug. See Louis Lasagna & Joseph A. DiMasi, Let's Speed Up the Approval of New Indications for Old Drugs, MED. MARKETING & MEDIA, Dec. 1996, at 88; Joseph A. DiMasi, Jeffrey S. Brown & Louis Lasagna, An Analysis of Regulatory Review Times of Supplemental Indications for Already-Approved Drugs, 30 DRUG INFO. J. 315 (1996). Longer lags in approval time for supplemental NDAs might seem to be a counterintuitive finding given that the "safety" of FDA's safety and effectiveness concerns is resolved in the agency's approval of the initial use. A partial response is that FDA may be using the supplemental application as an opportunity to review its initial conclusion regarding safety on the basis of subsequently developed data. See John Schwartz, Is FDA Too Quick to Clear Drugs? Growing Recalls, Side Effect Risks Raise Questions, WASH. POST, Mar. 23, 1999, at A1. Preliminary research indicates that the Prescription Drug User Fees Act of 1992 may have decreased the amount of time required for approvals of supplemental applications. See Food and Drug Admin./Dept. of Health and Human Services, Fourth Annual Performance Report/Prescription Drug User Fee Act of 1992/Fiscal Year 1996 Report to Congress 7 (1996). See also Merrill, Symposium on Regulating Medical Innovation, supra note 89, at 1795-96 (citing evidence regarding the effect of PDUFA on review time and costs for new and supplemental applications).
184. Developing studies necessary to support supplemental applications constitutes a large part of the expense. The Tufts Center for the Study of Drug Development estimates that developing data for a supplemental application is in the multi-million dollar range with an upper bound in the ballpark of $312,000,000 - in 1997 dollars. See Letter from Peg Hewitt, Research Librarian, Tufts Center for the Study of Drug Development, Mar. 24, 1999 (on file with author). See also Joseph A. DiMasi, R.W. Hansen, H.G. Grabowski & Louis Lasgana, Cost of Innovation in the Pharmaceutical Industry, 10 J. HEALTH ECON. 107 (1991). Time costs involved in submitting supplemental NDAs also are substantial; between 1989 and 1993, FDA took, on average, ten months longer to approve a supplemental application than it did to approve the original NDA for the same drug. See Louis Lasagna & Joseph A. DiMasi, Let's Speed Up the Approval of New Indications for Old Drugs, MED. MARKETING & MEDIA, Dec. 1996, at 88; Joseph A. DiMasi, Jeffrey S. Brown & Louis Lasagna, An Analysis of Regulatory Review Times of Supplemental Indications for Already-Approved Drugs, 30 DRUG INFO. J. 315 (1996). Longer lags in approval time for supplemental NDAs might seem to be a counterintuitive finding given that the "safety" of FDA's safety and effectiveness concerns is resolved in the agency's approval of the initial use. A partial response is that FDA may be using the supplemental application as an opportunity to review its initial conclusion regarding safety on the basis of subsequently developed data. See John Schwartz, Is FDA Too Quick to Clear Drugs? Growing Recalls, Side Effect Risks Raise Questions, WASH. POST, Mar. 23, 1999, at A1. Preliminary research indicates that the Prescription Drug User Fees Act of 1992 may have decreased the amount of time required for approvals of supplemental applications. See Food and Drug Admin./Dept. of Health and Human Services, Fourth Annual Performance Report/Prescription Drug User Fee Act of 1992/Fiscal Year 1996 Report to Congress 7 (1996). See also Merrill, Symposium on Regulating Medical Innovation, supra note 89, at 1795-96 (citing evidence regarding the effect of PDUFA on review time and costs for new and supplemental applications).
185. Developing studies necessary to support supplemental applications constitutes a large part of the expense. The Tufts Center for the Study of Drug Development estimates that developing data for a supplemental application is in the multi-million dollar range with an upper bound in the ballpark of $312,000,000 - in 1997 dollars. See Letter from Peg Hewitt, Research Librarian, Tufts Center for the Study of Drug Development, Mar. 24, 1999 (on file with author). See also Joseph A. DiMasi, R.W. Hansen, H.G. Grabowski & Louis Lasgana, Cost of Innovation in the Pharmaceutical Industry, 10 J. HEALTH ECON. 107 (1991). Time costs involved in submitting supplemental NDAs also are substantial; between 1989 and 1993, FDA took, on average, ten months longer to approve a supplemental application than it did to approve the original NDA for the same drug. See Louis Lasagna & Joseph A. DiMasi, Let's Speed Up the Approval of New Indications for Old Drugs, MED. MARKETING & MEDIA, Dec. 1996, at 88; Joseph A. DiMasi, Jeffrey S. Brown & Louis Lasagna, An Analysis of Regulatory Review Times of Supplemental Indications for Already-Approved Drugs, 30 DRUG INFO. J. 315 (1996). Longer lags in approval time for supplemental NDAs might seem to be a counterintuitive finding given that the "safety" of FDA's safety and effectiveness concerns is resolved in the agency's approval of the initial use. A partial response is that FDA may be using the supplemental application as an opportunity to review its initial conclusion regarding safety on the basis of subsequently developed data. See John Schwartz, Is FDA Too Quick to Clear Drugs? Growing Recalls, Side Effect Risks Raise Questions, WASH. POST, Mar. 23, 1999, at A1. Preliminary research indicates that the Prescription Drug User Fees Act of 1992 may have decreased the amount of time required for approvals of supplemental applications. See Food and Drug Admin./Dept. of Health and Human Services, Fourth Annual Performance Report/Prescription Drug User Fee Act of 1992/Fiscal Year 1996 Report to Congress 7 (1996). See also Merrill, Symposium on Regulating Medical Innovation, supra note 89, at 1795-96 (citing evidence regarding the effect of PDUFA on review time and costs for new and supplemental applications).
186. Developing studies necessary to support supplemental applications constitutes a large part of the expense. The Tufts Center for the Study of Drug Development estimates that developing data for a supplemental application is in the multi-million dollar range with an upper bound in the ballpark of $312,000,000 - in 1997 dollars. See Letter from Peg Hewitt, Research Librarian, Tufts Center for the Study of Drug Development, Mar. 24, 1999 (on file with author). See also Joseph A. DiMasi, R.W. Hansen, H.G. Grabowski & Louis Lasgana, Cost of Innovation in the Pharmaceutical Industry, 10 J. HEALTH ECON. 107 (1991). Time costs involved in submitting supplemental NDAs also are substantial; between 1989 and 1993, FDA took, on average, ten months longer to approve a supplemental application than it did to approve the original NDA for the same drug. See Louis Lasagna & Joseph A. DiMasi, Let's Speed Up the Approval of New Indications for Old Drugs, MED. MARKETING & MEDIA, Dec. 1996, at 88; Joseph A. DiMasi, Jeffrey S. Brown & Louis Lasagna, An Analysis of Regulatory Review Times of Supplemental Indications for Already-Approved Drugs, 30 DRUG INFO. J. 315 (1996). Longer lags in approval time for supplemental NDAs might seem to be a counterintuitive finding given that the "safety" of FDA's safety and effectiveness concerns is resolved in the agency's approval of the initial use. A partial response is that FDA may be using the supplemental application as an opportunity to review its initial conclusion regarding safety on the basis of subsequently developed data. See John Schwartz, Is FDA Too Quick to Clear Drugs? Growing Recalls, Side Effect Risks Raise Questions, WASH. POST, Mar. 23, 1999, at A1. Preliminary research indicates that the Prescription Drug User Fees Act of 1992 may have decreased the amount of time required for approvals of supplemental applications. See Food and Drug Admin./Dept. of Health and Human Services, Fourth Annual Performance Report/Prescription Drug User Fee Act of 1992/Fiscal Year 1996 Report to Congress 7 (1996). See also Merrill, Symposium on Regulating Medical Innovation, supra note 89, at 1795-96 (citing evidence regarding the effect of PDUFA on review time and costs for new and supplemental applications).
187. FDAMA requires, inter alia, that FDA publish standards for review of supplemental applications. See Covington & Burling, Unpublished Memorandum: Food and Drug Administration Modernization Act of 1997, Dec. 12, 1997, at 88. FDAMA also requires FDA to work more closely with the National Institutes of Health and other medical and scientific entities in order to encourage manufacturers to submit supplemental applications and help them identify existing studies to use in doing so, thus decreasing manufacturers' costs in submitting supplemental applications. See id.
188. In the past, the benefit of the new approval came largely through expanded sales that would result from the manufacturer's ability to promote the new use of its drug. But see Nicholas L. Ruggieri, Implications of Regulatory Policies on Off-Label Uses for Industry Competitiveness, 32 DRUG INFO. J. 379 (1998) (noting that manufacturers may also consider the potential benefit of expanded demand for their product should FDA approval lead insurers to permit reimbursement for the newly approved use).
189. Congress has employed both transfer and exclusivity approaches to incentive creation in the prescription drug context in the past. See, e.g., Merrill, supra note 89, at 1790-91 (discussing dual incentive scheme under the Orphan Drug Amendments).
190. The government would not know the competitive price for a pioneer drug, and permitting the extension of the manufacturer's market power would generate a reward to manufacturers of a magnitude not easily observable to government. As a result, the patent reward might allow a manufacturer to recover far more than its costs in applying for supplemental approval for an off-label use.
191. The patent-extension approach would not be a viable alternative in such a scenario.
192. Unlike direct reimbursement for research costs, patent extension conditional on supplemental approval would not create moral hazard by encouraging testing even where probability of approval is low.
193. See, e.g., Merrill, supra note 89, at 1791 ("[T]he appeal of extended market exclusivity inspires many applications for orphan drug status.") (citing Joseph A. Levitt & John V. Kelsey, The Orphan Drug Regulations and Related Issues, 48 FOOD & DRUG L.J. 525, 531 (1993)). Merrill notes that the desire to gain market exclusivity has led to strategic maneuvering by manufacturers. Such lessons should inform drafting of any patent extension solution to the supplemental NDA problem.
194. Pub. L. No. 95-396, 92 Stat. 819 (1978).
195. See Federal Insecticide, Fungicide, and Rodenticide Act, 61 Stat. 163, as amended, 7 U.S.C. §§ 136 et seq.
196. See Federal Pesticide Control Act of 1972, § 3(c)(1)(D), 86 Stat. 973 (1994). See also H.R. REP. NO. 95-663 (1977) at 17-18; S. REP. NO. 95-334 at 7, 33-44 (1977) (noting that establishing a limited proprietary interest in data generated to support pesticide registrations would serve as an additional incentive for research and development in pesticides).
197. See Federal Pesticide Control Act of 1972, § 3(c)(1)(D), 86 Stat. 973 (1994). See also H.R. REP. NO. 95-663 (1977) at 17-18; S. REP. NO. 95-334 at 7, 33-44 (1977) (noting that establishing a limited proprietary interest in data generated to support pesticide registrations would serve as an additional incentive for research and development in pesticides).
198. See Thomas v. Union Carbide Agric. Prods., 473 U.S. 568 (1985).
199. Id. Challengers unsuccessfully argued that the 1978 Act violated Article III of the Constitution by delegating judicial powers to a non-Article III tribunal.
200. Thus, where generics have entered the market, the pesticide model would require manufacturers of generics to reimburse the pioneer manufacturer for the costs it occurred in submitting a supplemental NDA. Were the market perfectly competitive market, neither pioneers nor incumbent generic manufacturers would be able to pass supplemental NDA costs on to consumers through supracompetitive pricing. In fact, however, the market for drugs does not appear to be a perfectly competitive one; capital and advertising costs as well as extensive regulation contribute to barriers to entry.
201. Compensation for submission of supplemental NDAs arguably is "an integral part of a program safeguarding the public health" delegable to an administrative agency under Article I of the Constitution without the provision of Article III adjudication. Thomas, 473 U.S. at 589 ("Congress, without implicating Article III, could have authorized [the agency] to charge follow-on registrants fees to cover the cost of data and could have directly subsidized FIFRA data submitters. . . . Instead it selected a framework that collapses these two steps into one, and permits the parties to fix the amount of compensation, with binding arbitration to resolve intractable disputes. Removing the task of valuation from agency personnel to civilian arbitrators, selected by agreement of the parties or appointed on a case-by-case basis by an independent federal agency, surely does not diminish the likelihood of impartial decision-making free from political influence.") Id. at 589-90 (internal citations omitted). In designing new legislation based on the pesticide model, Congress also can take affirmative steps to replicate the features of the pesticide scheme contributing to its status as an acceptable delegation. For example, the Thomas Court noted that, "FIFRA limits but does not preclude review of the arbitration proceeding by an Article III court . . . [and] at a minimum allows private parties to secure Article III review of the arbitrator's 'findings and determination' for fraud, misconduct, or misrepresentation." Id. at 592 (internal citations omitted).
202. Setting only a single patent term for the submission of supplemental NDAs would be less efficient because it would be both over- and under-inclusive. Where costs of submitting are higher than the value of the patent extension (discounted for the risk of non-approval and the time costs of money), manufacturers would fail to submit even where doing so would be in society's best interest. At the same time, where costs of submission are lower than the discounted value of the extension, they would submit even where the value to society of the new submission is lower than the net loss in social welfare incurred through the increased period of monopoly pricing. Using a variable patent term subject to arbitration, neutral experts could take into consideration societal benefits as well as manufacturers' costs related to submission. Admittedly, value to society would be difficult to assess. But expert arbitrators might consider proxies, including how widespread off-label use was at the time of submission, how different the new approval is from the initially-approved one, and how great the potential danger of the particular untested uses might have been. Thus, where a supplemental application relied on prior studies instead of ones newly undertaken for purposes of the supplemental application, the benefit to society from the approval would be lower (consisting only of the value of FDA review rather than the value of newly produced studies), the manufacturers' costs would be lower, and the period of the patent extension would be authorized as a reward to the manufacturer would be lower.
203. FDAMA in fact encouraged this type of cooperation. The Act contains two provisions encouraging FDA to seek conformity between its own requirements and broader international standards. Section 410(a) of the Act amends § 520(f)(1)(B) of the FDCA to require, to the greatest extent practicable, that device good manufacturing practice requirements conform to international device quality standards. Section 410(b) of FDAMA amends § 803 of the FDCA to add subsection (c) promoting internationally harmonized regulatory requirements where consistent with FDA's other obligations. Section 803(c)(3), in particular, requires FDA to participate in regular meetings with foreign governments to reach agreements regarding future harmonization of regulatory requirements.
204. Some commentators have taken the opposite position, arguing that guidance for the Internet is of little value because technological change will render guidance obsolete. Such concerns can be allayed by "technology-neutral" standards, however. Technology-neutral standards have the added advantage of facilitating coordination with other regulators of the Internet. See, e.g., White House, A Framework for Global Electronic Commerce, available at 〈www.whitehouse.gov/WH/New/Commerce/read.html〉.
205. Under FDAMA, FDA may provide for public comment after it implements guidance. See FDAMA § 701(h)(1)(D), allowing the agency to revise guidance in light of feedback gained from practical experience under the new standards.