FDA Law Blog

District Court Rules That FDA Cannot Regulate E-Cigarettes as Drug-Device Combination Products; FDA Detention Decisions Are Reviewable by Courts

By Peter M. Jaensch –
 
On January 14, 2010, the United States District Court for the District of Columbia issued a decision in Smoking Everywhere, Inc. and Sottera, Inc. d/b/a NJOY v. United States Food and Drug Administration, et al., in which the court granted the plaintiffs’ motion for a preliminary injunction, thereby enjoining FDA from regulating electronic cigarettes as drug-device combination products.  E-cigarettes, which are packaged to look and feel like real cigarettes, are intended to replicate smoking by vaporizing a nicotine liquid that the user then inhales - a process users call “vaping.”

The case arises from detentions imposed by FDA on the import of electronic cigarettes, which FDA contends are drug-devices under the FDCA and therefore subject to FDA regulation. The court concluded that treating e-cigarettes as drug-device combination products, rather than tobacco products, was unlawful, absent a showing that the products are intended to assist in treating nicotine addiction or to “affect the structure or function of the body in a way distinguishable from ‘customarily marketed’ tobacco products.” The court believed that doing so would frustrate Congress’ clear intent to distinguish FDA’s regulation of drugs and devices from its regulation of tobacco products.

The court did not opine whether FDA could regulate e-cigarettes under the Family Smoking Prevention and Tobacco Control Act, which was signed into law after the FDA detention had been imposed.  It would appear that FDA lacks such authority until it issues a regulation bringing e-cigarettes under its jurisdiction as tobacco products.

The decision holds out the potential for a far wider significance with regard to all products regulated by FDA.  In footnote 8, the court analyzes and rejects FDA’s position that its import decisions are unreviewable by courts. The ruling on this point will undoubtedly suggest that other importers of a variety of products regulated by FDA will sue FDA to challenge import decisions or at least use the threat of a suit as leverage to get FDA to allow imported products into the U.S.

District Court Strikes Down Some Tobacco Act Provisions as Unconstitutional

By David B. Clissold –

Acting on cross motions for summary judgment, a Federal District Court in Kentucky has struck down some provisions of the Family Smoking Prevention and Tobacco Control Act (“Tobacco Act”) as unconstitutional, and upheld others.  As we had reported earlier, the plaintiffs originally argued that portions of the Act violated their free speech rights under the First Amendment; their due process rights under the Fifth Amendment; and effected an unconstitutional “taking” of property under the Fifth Amendment.  For reasons that are not clear, the plaintiffs apparently abandoned most of their Fifth Amendment claims during the course of the proceedings.  Thus, the decision primarily concerned free speech.

Unconstitutional As A Violation Of Free Speech Under The First Amendment

The Tobacco Act provides that labeling or advertising for cigarettes or smokeless tobacco must use only black text on a white background.  The court held this portion of the law unconstitutional since “images of packages of their products, simple brand symbols, and some uses of color communicate important commercial information about their products” such as who makes the product.  In addition, the Tobacco Act's “blanket ban” on all uses of color and images was too broad since it also precluded use of “innocuous images and colors – e.g., images that teach adult consumers how to use novel tobacco products, images that merely identify products and producers, and colors that communicate information about the nature of a product . . .”

The Tobacco Act prohibits any statement in labeling or through the media suggesting that the product was approved by FDA, that FDA deems the product to be safe, or that FDA endorsed the use of the product.  The court held that these prohibitions were reasonable.  However, the law also banned statements suggesting that “the product is safe or less harmful” because it was regulated or inspected by FDA or that it was in compliance with FDA regulations.  This was held to be unconstitutional since it banned “journalists, doctors, scientists, politicians, and numerous other groups and individuals” from making statements about the effect of the FDA regulation of tobacco products.

Too Early To Tell Whether Constitutional Under The First Amendment

The Tobacco Act bans all “outdoor advertising for cigarettes or smokeless tobacco, including billboards, posters, or placards, . . . within 1,000 feet of the perimeter of any public playground or playground area in a public park . . ., elementary school, or secondary school.”  However FDA must issue a regulation “in light of governing First Amendment case law,” explaining how this ban will be enforced before it can take effect.  The court held it could not examine this issue until FDA had issued the final regulation.

Constitutional Under The First Amendment

The Tobacco Act requires tobacco companies to print new government warnings for cigarette packages that occupy the top 50% of the front and rear panels of packaging and include “color graphics depicting the negative health consequences of smoking to accompany the label statements.” Similar warnings, occupying 30% of each of the two principal display panels, are required for smokeless tobacco products.  For all categories of tobacco products, the new warnings must occupy 20% of any advertisements.  The court held that such requirements were reasonable in part because Congress “relied on the international consensus reflected in the World Health Organization’s Framework Convention on Tobacco Control” and also reviewed “the use of a nearly identical warning requirement in Canada.”  The court also noted that even with the warnings, a substantial amount of area remained for use by the manufacturers.  However, the court ruled that the plaintiffs’ takings claim under the 5th Amendment needed to be brought in the Court of Federal Claims, and so the court lacked jurisdiction to decide that issue.

Manufacturers can not promote their brands through sponsorship of “athletic, musical, artistic, or other social or cultural event[s]” and FDA must reissue regulations that prohibit the sponsorship of athletic, social, and cultural events “in the brand name” of a tobacco product.  The court found because such events “glamorized” smoking and that many children were exposed to the events, the limitations on sponsorship were permitted.  The law also directs FDA to reissue regulations that prevent a tobacco manufacturer from distributing items such as caps and t-shirts that bear the name or logo of a tobacco brand.  The court agreed that it was impossible to limit the distribution of these items to adults only and noted that even if it was, the wearers would become “walking advertisements” conveying the notion “that tobacco use is widely accepted.”  Accordingly, the court held that the ban on such items was constitutional. With respect to the law's ban on free samples, gifts with purchase, and marketing tobacco products with non-tobacco products, the court held that these provisions restricted distribution, but did not implicate free speech rights.

The Tobacco Act’s Modified Risk Tobacco Products (“MRTP”) provision prohibits the labeling, or advertising of a tobacco product from suggesting that the product is less harmful than other tobacco products, and prohibits manufacturers from taking any action that would be reasonably expected to result in consumers believing that the tobacco product or its smoke may be less harmful than other tobacco products, without prior FDA approval of the product as “modified risk.” The plaintiffs had already lost a motion for a preliminary injunction in November 2009 that this law violated free speech.  None of the arguments presented subsequently were enough to change the court’s mind.

Conclusion

Both sides can claim at least partial victory under this decision, and it is not yet clear whether any of the parties will appeal any portion of the ruling.  In upholding many of the challenged provisions of the Tobacco Act, the court relied on Congressional findings and reports from the Institute of Medicine, World Health Organization, National Cancer Institute, and other organizations that focused on the effect that tobacco advertising may have on underage smoking.  The court agreed that preventing children from smoking was a “substantial” government interest, and found that most of the Tobacco Act’s provisions controlling the advertising and promotion of cigarettes and smokeless tobacco were directly related to promoting that interest.  Aside from any appeal in this case, the next significant challenge is likely to be whether FDA’s regulation to control outdoor advertising passes constitutional muster.

Need a Summary of the New Tobacco Law and a Look at its Impact on Retailers?

By Ricardo Carvajal & David B. Clissold –

The most recent issue of the Food and Drug Law Journal contains an article on the Family Smoking Prevention and Tobacco Control Act (“Tobacco Act”) authored by Hyman, Phelps & McNamara’s (“HPM’s”) Ricardo Carvajal, David B. Clissold, and Jeffrey K. Shapiro.  The Tobacco Act provides FDA with regulatory authority over virtually every aspect of the design, production, marketing, and advertising of tobacco products. Although the new law has its detractors, there is little question that the law’s enactment marks a dramatic shift in the relationship between the federal government and the tobacco industry.  This article provides a summary of the new law’s major provisions and highlights some of the legal issues that implementation of the law is likely to raise.  The authors gratefully acknowledge HPM’s Tom Scarlett for his review of a draft of the manuscript.

The most recent issue of the Food and Drug Law Institute's Update magazine contains an article authored by Ricardo Carvajal and David B. Clissold that focuses on the Tobacco Act's impact on retailers.  In the sectors that FDA has historically regulated, FDA has focused the bulk of its resources on ensuring that manufacturers and wholesale distributors are in compliance with the law.  FDA has generally undertaken little enforcement activity against retailers, whose conduct is typically policed by state authorities.  This could change under the Tobacco Act, which aims to restrict the availability and appeal of tobacco products to youth.

Court Dismisses Lawsuit over FDA’s Ban of Flavored Rolling Papers

By Ricardo Carvajal –

FDA has prevailed on summary judgment in a lawsuit brought by BBK Tobacco & Foods, LLP ("BBK") which sought a declaration that separately sold flavored rolling papers are not tobacco products subject to regulation under the FDCA.  Previously, FDA issued a draft guidance document and sent a letter to industry stating the agency’s belief that flavored rolling papers are banned by the FDCA as amended by the Family Smoking Prevention and Tobacco Control Act ("Tobacco Act").  BBK challenged FDA’s interpretation of the statute, and alleged that FDA’s actions had caused customers to stop buying BBK’s products. 

The court ruled that the issues presented by BBK were not ripe for judicial review because FDA’s actions were not final agency action.  The court noted that no legal consequences flow from FDA’s publication of guidance.  Further, the court found that the hardship suffered by BBK had been largely the result of its own voluntary decision to stop distributing its products on the effective date of the Tobacco Act, and of BBK customers’ voluntary decisions to return BBK products.  FDA had taken no action that specifically targeted BBK or its products.  The court further ruled that BBK had failed to exhaust its administrative remedies because it had not filed a citizen petition with FDA seeking a “formal determination of whether the Tobacco Act applies to BBK’s products.”

The moral of the story?  If an FDA draft guidance suggests that your product is unlawful, you'll need to file a citizen petition and/or face a warning letter or injunction before you can get judicial relief.

FDA Proposes Timetable for Review of Modified Risk Tobacco Products

By Ricardo Carvajal –

FDA has issued a draft guidance that proposes a “preliminary” timetable for the agency’s review of applications for approval of modified risk tobacco products (MRTP’s).  FDCA section 911(a) prohibits the introduction of an MRTP into interstate commerce unless FDA has issued an approval order under section 911(g).  However, the statute does not specify a time limit for FDA’s review and decision on MRTP applications.  Instead, the statute allows FDA two years to issue a regulation or guidance that establishes a “reasonable timeframe” for its review.  The lack of a time limit for review was a key issue cited in a recent case challenging the constitutionality of the MRTP provisions (see our prior post).  Although plaintiffs in that case failed to secure a preliminary injunction, the court noted that the lack of a reasonable time limit for review of MRTP applications rendered the statute potentially vulnerable to a First Amendment challenge (“The Court thinks it likely that this two-year delay is unconstitutional given that certain portions of the MRTP provision have been in effect since June 22, 2009”).

FDA’s draft guidance appears to address that vulnerability by establishing a “reasonable preliminary timetable” of 360 days.  In doing so, FDA dismissed the 180-day time period for review of drug and device applications as too short, given the statutory requirements that FDA seek public comment on MRTP applications and also refer them to the Tobacco Products Scientific Advisory Committee.  FDA also tentatively dismissed the 540-day time period for review of health claims as unnecessarily long, given that notice-and-comment rulemaking is not required for a decision on an MRTP application.  The draft guidance signals that the agency expects to issue more detailed guidance or regulations once it has acquired a base of experience with processing MRTP applications.  In the interim, the guidance suggests that the first MRTP applicants may be in for a rough ride:

The Agency has not yet received an MRTP application. It therefore does not have experience in reviewing such applications, and has no information based on prior experience regarding the length of time required for review of such applications. Moreover, the MRTP application review process and approval criteria are new, and the Agency is likely to encounter a number of questions of first impression involving science, law, policy, and procedure. Resolving questions of first impression may mean that the initial applications will require more time than later submitted ones.

Comments on the draft guidance are due by February 25, 2010.

Center for Tobacco Products to offer training on eSubmitter

By David B. Clissold and Ricardo Carvajal

The Center for Tobacco Products has scheduled a web-based training session on use of the eSubmitter program to electronically submit establishment registration and product listing information (see here).  Submission of that information by December 31 is required under FDCA section 905.  Those who are interested in participating are directed to provide their Company name and contact information to eSubmitter@fda.hhs.gov by noon on Wednesday, November 18.  FDA advises that, in the absence of sufficient interest, the training may be cancelled.

District Court Denies Preliminary Injunction in a Case Challenging the Family Smoking Prevention and Tobacco Control Act

By Kurt R. Karst –      

The U.S. District Court for the Western District of Kentucky (Bowling Green Division) denied a Motion for Preliminary Injunction in a case concerning the Constitutionality of the recently enacted Family Smoking Prevention and Tobacco Control Act (“FSPTCA”).  As we previously reported, five tobacco manufacturers (including R.J. Reynolds Tobacco Company, Lorillard Tobacco Company, and Commonwealth Brands, Inc.) and a retailer of tobacco products filed a Complaint in August alleging that certain FSPTCA provisions concerning Modified Risk Tobacco Products (“MRTP”) violate their First Amendment right to engage in commercial speech. 

The MRTP provisions of the FSPTCA (FDC Act § 911) prohibit the introduction into interstate commerce of any tobacco product that is “sold or distributed for use to reduce harm or the risk of tobacco-related disease,” which means a product:

(i) the label, labeling, or advertising of which represents explicitly or implicitly that –

(I) the tobacco product presents a lower risk of tobacco-related disease or is less harmful than one or more other commercially marketed tobacco products;

(II) the tobacco product or its smoke contains a reduced level of a substance or presents a reduced exposure to a substance; or

(III) the tobacco product or its smoke does not contain or is free of a substance;

(ii) the label, labeling, or advertising of which uses the descriptors “light”, “mild”, or “low” or similar descriptors; or

(iii) the tobacco product manufacturer of which has taken any action directed to consumers through the media or otherwise, other than by means of the tobacco product's label, labeling, or advertising, after June 22, 2009, respecting the product that would be reasonably expected to result in consumers believing that the tobacco product or its smoke may present a lower risk of disease or is less harmful than one or more commercially marketed tobacco products, or presents a reduced exposure to, or does not contain or is free of, a substance or substances.

To market an MRTP, a company must first file an application with the Department of Health and Human Services Secretary.  The application is made available for public comment and is referred to the Tobacco Products Scientific Advisory Committee for a recommendation.  An MRTP application may be granted if it is determined that the applicant has demonstrated that “the product, as it is actually used by consumers, will (1) significantly reduce harm and risk of tobacco-related disease to individual tobacco users; and (2) benefit the health of the population as a whole taking into account both users of tobacco products and persons who do not currently use tobacco products.”

The Plaintiffs contended in their briefs (here, here, and here), among other things, that the MRTP provision is: (1) “a viewpoint-based restriction on core First Amendment speech . . . subject to strict scrutiny” which fails to pass review because “it is not necessary to serve the asserted interest;” (2) an unconstitutional prior restraint because it “lacks any of the constitutionally-mandated procedural safeguards that the Supreme Court requires of prior restraints under any level of scrutiny;” and (3) void for vagueness.  FDA countered in its brief that “the statutory provisions regulating [MRTPs] do not restrict speech; they restrict the distribution of certain products without FDA review,” that strict scrutiny is inapplicable, and that even if the commercial speech test applies, “[t]he dangers of products sold or distributed as modified risk tobacco products that do not in fact reduce risk are so high that there is a compelling governmental interest in ensuring that statements about modified risk tobacco products are complete, accurate, and relate to the overall disease risk of the product” and the FSPTCA is narrowly tailored to advance that important governmental interest.  (Eleven non-profit public health organizations and consumer advocacy groups, including the Campaign for Tobacco-Free Kids and the American Cancer Society, supported FDA’s position in an amicus brief.) 

After assuming “for purposes of this preliminary injunction motion that the MRTP provision regulates speech and must satisfy the First Amendment,” the court stated that “it seems likely that its restrictions on speech are constitutionally permissible” using the familiar test for government regulation of commercial speech that was announced by the Supreme Court in Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557 (1980).  In particular, the court noted that the government has a substantial interest in protecting consumers from misleading tobacco industry claims about allegedly reduced risk tobacco products because of the “significant health risks associated with the use of tobacco products and the history of marketing ‘low tar’ and ‘light’ cigarettes, that the government adequately demonstrated that “the harms it recites are real” and that the FSPTCA’s MRTP provision will “alleviate [the harms] to a material degree,” and that there is “at least a reasonable fit between the means and ends of the MRTP regulatory scheme.” 

After considering each of the factors for granting a preliminary injunction, the court ruled that such a remedy is unwarranted.  The court did note, however, that the Plaintiffs have some likelihood of success on the theory that the MRTP provision operates as a prior restraint and lacks a reasonable time limit for review:

Under the MRTP provision, tobacco manufacturers must submit not only the would-be modified risk product but any “proposed advertising and labeling” and “sample product labels and labelling” to the FDA for review. . . .  Thus, any such proposed speech about a modified risk tobacco product is effectively silenced until the FDA issues a decision. Because this is so, the reasonable time limit safeguard is necessary to satisfy the “principle that the freedoms of expression must be ringed about with adequate bulwarks.”  Bantam Books, Inc. v. Sullivan, 372 U.S. 58, 66 (1963).  At this point, such a time limit is missing.  While Congress has charged the FDA with “establish[ing] a reasonable timetable for the Secretary to review an application under this section,” it has given the FDA two years to come up with one. . . .  The Court thinks it likely that this two-year delay is unconstitutional given that certain portions of the MRTP provision have been in effect since June 22, 2009.

On that basis, the court concluded that the first factor of the preliminary injunction analysis – i.e., whether the Plaintiffs have a strong likelihood of success on the merits – was not determinative and proceeded to analyze the other three preliminary injunction factors.

It is unclear whether the Plaintiffs in the case will appeal the ruling.  There has been significant speculation that the U.S. Supreme Court will ultimately be asked to rule on the Constitutionality of the FSPTCA.  Meanwhile, FDA continues to flex its new enforcement muscles granted to the Agency under the FSPTCA.  Last week, FDA announced that it issued several Warning Letters to companies marketing illegal flavored cigarettes.  FDA has also been sued by a cigar importer and distributor in connection with FDA statements regarding flavored cigarettes.

What is a Tobacco Product “Ingredient”?

By Ricardo Carvajal, David B. Clissold & Jeffrey K. Shapiro –

FDA has published a draft guidance for industry on the listing of ingredients in tobacco products that manufacturers and importers are required to submit to the agency under FDCA section 904(a)(1).  The FDCA does not define the term “ingredient” for purposes of section 904(a)(1), but that section calls for the submission of a listing of “all ingredients, including tobacco, substances, compounds, and additives that are. . . added by the manufacturer to the tobacco, paper, filter, or other part of each tobacco product.”  In part, section 900(1) broadly defines “additive” to mean:

any substance the intended use of which results or may reasonably be expected to result, directly or indirectly, in its becoming a component or otherwise affecting  he characteristic of any tobacco product (including any substances intended for use as a flavoring or coloring or in producing, manufacturing, packing, processing, preparing, treating, packaging, transporting, or holding).

Perhaps teeing off of the broad definition of “additive” and its inclusion by reference in section 904(a)(1), the draft guidance states that “FDA considers ingredients that are introduced in packaging and that are known or may be reasonably expected to become incorporated into the consumed product to be ingredients that are added by the manufacturer to the tobacco product.”  The guidance further states that, under certain circumstances, reaction products are considered to be “ingredients”:

When a material is known or reasonably expected to be formed through a chemical reaction during tobacco product manufacturing, FDA considers the resultant material to be an ingredient that is added by the tobacco product manufacturer. As such these reaction products are to be listed in the ingredient listing. Reaction products may result from, among other things, reactions that occur during a mixing operation, during an in-process holding step, or during a storage period. The reaction product(s) may result from a reaction between ingredients in the same part of a product (e.g., reconstituted tobacco) or between ingredients added to different parts of the product (e.g., tobacco, paper) or added at different manufacturing steps.

For those who would like to submit comments, time is short.  Comments are due by November 13.

Q: What does FDA’s Regulation of Tobacco Products Have in Common with its Regulation of Dietary Supplements? A: FDA’s Interpretation of “Marketing.”

By Ricardo Carvajal –

FDA has issued a draft guidance document that addresses FDCA section 201(rr)(4), which prohibits a tobacco product from being “marketed” in combination with any other FDA-regulated product.  The guidance provides the following as an example of prohibited conduct: "Nicotine that is derived from tobacco is added to water, juice, or soda (which are foods under the FDCA) and the water, juice, or soda is identified as containing a tobacco product."

This example suggests that, if a food is not “identified” as containing a tobacco product, then the prohibition in section 201(rr)(4) does not apply because the tobacco product has not been “marketed.”  This result is consistent with FDA’s interpretation of the term “marketed” as used in FDCA section 201(ff)(3)(B), otherwise known as the dietary supplement exclusionary clause.  In part, the exclusionary clause excludes from the definition of a dietary supplement an article that is approved as a new drug unless it is first “marketed” as a dietary supplement (or as another type of food).  In applying the exclusionary clause, FDA has taken the position that an article is not “marketed” as a supplement when it is merely present in a supplement that is offered for sale; rather, the article must have been sold or offered for sale as a supplement, or as a component of a supplement where the labeling or advertising for the supplement identified the presence of the article.

What FDA’s draft guidance leaves unsaid is that one can circumvent the prohibition in section 201(rr)(4) by not “identifying” a food as containing a tobacco product, but still run afoul of several adulteration and misbranding provisions of the FDCA.

Seeking Clarity, Cigar Importer Sues FDA

By David B. Clissold & Ricardo Carvajal –

An importer and distributor of cigars has sued FDA to enjoin the agency from taking any adverse action with respect to Djarum brand cigars under Chapter IX of the FDCA until such time as the agency lawfully asserts jurisdiction over cigars (Chapter IX was added to the FDCA by the Family Smoking Prevention and Tobacco Control Act).  Chapter IX currently applies only to cigarettes, cigarette tobacco, roll-your-own tobacco, and smokeless tobacco.  It does not apply to cigars or any other type of tobacco product until FDA issues a regulation under FDCA section 901(b) asserting authority over those products.  According to the complaint, Djarum brand cigars meet statutory and regulatory definitions of a “cigar” for purposes of taxation (e.g., 26 U.S.C. § 5702) and have been classified as cigars by the Alcohol and Tobacco Tax and Trade Bureau (“TTB”).  As such, Djarum brand cigars cannot be subject to regulatory action under the authority of Chapter IX unless and until FDA issues a regulation under section 901(b).

The suit was prompted by recent FDA statements relating to flavored cigarettes.  FDCA section 907(a)(1) bans cigarettes that contain a “characterizing flavor” as of September 22, 2009.  FDA issued a Letter to Industry on the eve of the ban stating that the ban “applies to all tobacco products that meet the definition of ‘cigarette’ in section 900(3) of the Act even if they are not labeled as ‘cigarettes’ or are labeled as cigars or as some other product” (see our prior post here).  The wording of FDA’s letter aroused concern that the agency might interpret the ban to apply to cigars that contain a “characterizing flavor.”  In addition, FDA had been petitioned by retailers either to clarify the products of concern or exercise enforcement discretion until it had done so, but FDA denied that request (see our prior post here).  According to the complaint, because of the resulting uncertainty in the cigar industry and the potential for seizure and civil penalties, plaintiff sued FDA asking the court to determine that the agency was precluded from taking enforcement action against the Djarum products.

This case may help to clarify where FDA intends to draw the definitional line between cigarettes and cigars.  What the case is unlikely to resolve is whether, and to what extent, FDA might in the future seek to curtail the marketing of flavored cigars.