Seton Hall Law White Paper Calls for FDA to Clarify Parameters, Enforcement in Banning Pharmaceutical Companies from Promoting Off-Label Use of Medications

Dean Kathleen M. Boozang, white paper’s co-author: “Our ultimate responsibility is to ensure that consumers and patients receive proper, effective medications, and in safe doses.”

Newark – A new white paper issued by the Seton Hall Law Center for Health & Pharmaceutical Law & Policy probes the various enforcement mechanisms for the Food and Drug Administration’s (FDA) ban on promotion of off-label medications, in terms of the underlying public policy goals, and offers recommendations for improvement.

The white paper, “The False Claims Act and the Policing of Promotional Claims about Drugs: A Call for Increased Transparency,” provides a comprehensive overview of the FDA’s ban on promotion of off-label drug use, and the multiple direct and indirect methods by which this ban is enforced by public authorities and private relators. The white paper concludes that greater transparency on the part of the involvement federal entities could substantially improve present practices.

“It is legal for physicians to practice ‘off-label use’ of medications – that is, to prescribe drugs in ways that may not have been officially sanctioned when the FDA initially approved a drug for market,” explained Dean Kathleen M. Boozang, co-author of the paper. “For example, physicians may prescribe a medication to treat an illness for which FDA approval has not been sought or given.”

However, pharmaceutical companies are prohibited from promoting such “off-label” uses outside of a few channels approved by the FDA for disseminating information, such as the distribution of peer-reviewed medical journals.

“There is a point at which the boundaries between permitted ‘dissemination” and prohibited ‘promotion’ become unclear,” said Dean Boozang. “Meanwhile, FDA rules have generated a confusing blend of public and private enforcement, primarily through settlements that provide little hard law.”

Recent years have seen harsh penalties against pharmaceutical companies for those accused of violating the ban on promoting off-label medications, resulting in multi-billion settlements with such companies as Johnson & Johnson (2013, $2.2 bil), GlaxoSmithKline (2012, $3 bil) and Pfizer (2009, $2.3 bil).

The biggest settlements typically occur in the False Claims Act context. That statute holds liable those who defraud government programs – in this case, Medicare and Medicaid. The white paper traces the complications of False Claims Act case enforcement, including the relationship among the U.S. Department of Justice, multiple interested federal and state agencies, and an increasingly sophisticated private relators’ bar. While it recognizes traditional off-label promotion enforcement, the white paper predicts the next frontier of off-label enforcement – providing pharmacoeconomics information to pharmacy benefit managers, payers, and provider organizations.

Among the white paper’s recommendations:

1. Transparency in reimbursement: The government should consider requiring that diagnosis information be added to claims for reimbursement under Medicare Part D and Medicaid, as it is for claims under Medicare Part B. This would give federal and state regulators the ability to use standard utilization management tools such as prior authorization to reduce medically unjustified prescribing and therefore, false claims.
2. Transparency about what is and is not “promotion”: Where possible, the government should consider making the law governing product promotion clearer and more granular, including by passing legislation, promulgating regulations, issuing guidance documents, developing safe harbors, or implementing an advisory opinion process.
3. Transparency in enforcement: When an off-label promotion case is resolved, the government should provide information about its rationales in negotiating and arriving at the settlement amount. This could include an explanation of the damages model used and the calculations performed. This would dispel the sense that the settlement amounts are arbitrary and guide decision making in subsequent disputes. Furthermore, the Department of Justice should move aggressively in dismissing cases it believes are not well-founded.

“We published this white paper to lay the groundwork for policy-makers to review and reconsider the parameters and the enforcement protocols in the FDA’s ban on promoting off-label use of medications,” concluded Dean Boozang. “Our ultimate responsibility is to ensure that consumers and patients receive proper, effective medications, and in safe doses.” 

View the white paper, “The False Claims Act and the Policing of Promotional Claims about Drugs: A Call for Increased Transparency,” here >>

Founded in 1951, Seton Hall University School of Law, New Jersey’s only private law school and a leading Catholic law school in the New York metropolitan area, is dedicated to excellence in teaching and in preparing students for the practice of law. The Center for Health & Pharmaceutical Law & Policy exists primarily to educate lawyers and health care industry professionals regarding the extraordinarily complex set of laws that govern patients, health care providers, manufacturers and suppliers. Furthermore, Center faculty and researchers produce scholarship and recommendations for policy on the varied and complex issues posed by health and pharmaceutical law. The Center fosters informed dialogue among policymakers, consumer advocates, the medical profession and industry in the search for solutions to the ethical, legal, and social questions presented in the health and pharmaceutical arena. As part of its educational mission, the Center is a leader in providing compliance education and training on the wide-ranging state, federal, and international mandates that apply to the development, safety, use and promotion of drugs and devices. For more information, visit law.shu.edu.