Transcript Slides

Updates from FTC on Regulation of
OTC Product Promotion
Speakers:
Gregory W. Fortsch, Senior Attorney, Division of Advertising
Practices, Bureau of Consumer Protection, FTC
Jonathan Cohn, Partner, Sidley Austin
Ivan Wasserman, Partner, Manatt, Phelps & Phillips, LLP
Moderated by David Vladeck, Professor of Law, Georgetown
University Law Center
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Federal Trade Commission Update -Over-the-Counter (OTC) Product Promotion
The Food and Drug Law Institute
Advertising & Promotion Conference
Breakout Session
Washington, D.C,
October 2, 2014
Gregory W. Fortsch
Attorney
Division of Advertising Practices
Bureau of Consumer Protection
U.S. Federal Trade Commission
My comments today reflect my own views.
They do not necessarily reflect the views of the
Federal Trade Commission, any individual
Commissioner, or any other person.
The FTC Act
(15 U.S.C. § 41 et seq.)
• The statute that governs advertising and
marketing of most products and services in
the U.S. is the Federal Trade Commission Act
(“FTC Act”).
The FTC Act
(15 U.S.C. § 41 et seq.)
• Section 5 of FTC Act: prohibits unfair or
deceptive acts or practices
• Section 12: prohibits any “false
advertisement” likely to induce the purchase
of foods, drugs, devices, services, or cosmetics
that is “misleading in a material respect”
FTC/FDA Coordination on OTC Drugs
• Overlapping statutory authority
• Memorandum of Understanding (1971)
- FDA → prescription drug advertising
- FTC → OTC drug advertising, excluding labeling
• Agencies coordinate closely on food and dietary
supplement policy issues
FTC/FDA Coordination on OTC Drugs
• FTC legal framework/approach
differs from FDA:
- Primarily a law enforcement agency, not a health
-
agency
No pre-market approval process, unlike FDA’s
pre-dissemination clearance
No regulatory distinction between product
categories
No regulatory distinction between health,
disease, and structure/function claims
FTC/FDA Coordination on OTC Drugs
• Complementary, consistent actions
• Avoid duplication
• Defer to FDA on content, purity,
safety, and efficacy
FTC Substantiation Doctrine
• Under Pfizer (1972), advertiser needs a “reasonable basis” for
express and implied objective claims before ad runs
• Two types of advertising claims:
1) Efficacy claims, such as “This pill makes you lose 10
pounds in 2 weeks.
2) Establishment claims, such as “This pill is clinically
proven to make you lose 10 pounds in 2 weeks.”
—
—
—
“Tests Prove . . .”
“Doctors Recommend . . .”
“Studies Show . . .”
Substantiation for “Establishment” Claims
• When an advertisement represents that the
claim is supported by a certain amount or level
of substantiation, the advertiser must possess at
least that level of support for the claim.
• These claims are either true or false.
• The required substantiation is evidence
acceptable to the relevant scientific community
to demonstrate that claims are true.
Substantiation for “Efficacy” Claims
•Under the FTC’s Substantiation Doctrine (Thompson Medical
(1984)), the amount and type of required substantiation
depends on:
1. Type of product (e.g., does it involve health or safety?)
2. Type of claim (e.g., is it a “credence” good?)
3. Benefits of truthful claim versus the cost/feasibility of
developing substantiation
4. Consequences of a false claim
5. What evidence do experts in the field expect?
Substantiation for Health Claims
Claims related to health and safety
generally must be supported by
“Competent and reliable
scientific evidence”
Competent and Reliable
Scientific Evidence
• A rigorous but flexible standard
• Question of fact to be determined in each case. Always
claims-driven (net impression)
• Often, experts in the field will say that randomized, wellcontrolled trials are necessary to substantiate a claim that a
product treats or prevents a disease.
- Experts also may require a clinical study for non-disease claims
-
that a product will affect the structure or function of the
human body. For example, “Fish oil improves memory.”
Rely on nutrition and science expertise of FDA
Enforcement Considerations
• Is FTC action in the public interest?
- Is a claim likely to be challenged by a
competitor under the Lanham Act?
- Has the NAD reviewed the claim? If NAD
refers the ad to us, we give it a close look.
Current FTC Law Enforcement
Activities
 OTC Homeopathic Products
• Filed a comment with FDA about their
•
regulatory framework for products
Held a Workshop in September 2015
 Solace International
• Topical cream for moles, skin tags, and wart
•
removal
FDA sent warning letter; FTC got an order with
fencing-in relief and redress
Current FTC Law Enforcement
Activities
 Gray Hair cases
• Supplements aimed at reversing/preventing the
•
formation of gray hair - two cases settled and a
third is in litigation
Made unfounded claims that their supplements
could prevent or reverse gray hair
 Melanoma App
• Deceptively claiming their mobile apps could
detect symptoms of melanoma, even in its early
stages
Current FTC Law Enforcement
Activities
 POM Wonderful
• D.C. Circuit affirmed the Commission’s decision
•
finding the company and its past president liable
for advertisements promoting POM juice for the
treatment or prevention of heart disease,
prostate cancer, and erectile dysfunction
The court also upheld that Commission’s order
except to the extent that it required 2
randomized controlled clinical studies for the
disease claims in the case
Current FTC Law Enforcement
Activities
• L’Occitane
• Settlement prohibited claims for substantial
•
•
weight or fat loss or substantial reduction in
body size
Also required 2 randomized controlled trials for
weight loss claims, and competent and reliable
evidence for cellulite claims
$450,000 monetary relief
Current FTC Law Enforcement
Activities
• L’Oreal
• Challenged advertising claims about gene
•
targeting mechanism and about scientific
studies
Settlement required competent and reliable
evidence for gene claims and prohibited
misrepresentations about tests or studies
Current FTC Law Enforcement
Activities
• Derma Doctor
• Challenged advertising claims about gene
•
targeting mechanism and about scientific
studies
Settlement required competent and reliable
evidence for gene claims, and prohibited
misrepresentations about tests or studies
Current FTC Law Enforcement
Activities
 CVS Advanced Eye Health Product
• Sent counsel for CVS closing letter in March 2015
• Does not mean a violation did not occur, but
decided to close since sales were low and claims
voluntarily removed by company
FTC Orders Going Forward
• For companies that are under order:
- weight loss cases
-
-
-
-
ban facially false claims
for unsubstantiated weight loss claims, at least 2 RCTs of product or
“essentially equivalent” product
cases of fraudulent or unethical scientific conduct may require 2 RCTs of the
product or an “essentially equivalent” product
for all other health cases with causal claims of a health benefit
o generally, “human clinical testing” (randomized, double-blind, placebo
controlled) of the product or “essentially equivalent” product
o although no set number of RCTs, experts might expect multiple RCTs
o will look at the quality of the RCT evidence and how it relates to the
entire body of relevant and reliable scientific evidence
Must preserve documents and data that experts would need to assess the
RCT later
Gregory W. Fortsch, Esq.
Division of Advertising Practices
Bureau of Consumer Protection
U.S. Federal Trade Commission
(202) 326-3617
[email protected]
Jonathan F. Cohn
Sidley Austin LLP
202-735-8110
[email protected]
BEIJING
BOSTON
BRUSSELS
CHICAGO
DALLAS
GENEVA
HONG KONG
HOUSTON
LONDON
LOS ANGELES
NEW YORK
PALO ALTO
SAN FRANCISCO
SHANGHAI
SINGAPORE
SYDNEY
TOKYO
WASHINGTON, D.C.
FTC’s Failed Attempt To Raise Standard For
Dietary Supplement Advertising
FDLI’s Advertising and Promotion Conference
October 2, 2015
Outline
I.
Regulatory Background
II. FTC’s Attempt to Raise Standard
III. United States v. Bayer
IV. Lessons Learned
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I. Regulatory Background:
Dietary Supplement Health & Education Act of 1994 (DSHEA),
Pub. L. No. 103-417, sec 8, (codified at 21 U.S.C. § 350(b).
Enacted to ensure that
supplements can be marketed
without meeting the stringent
requirements imposed on drugs:
•No pre-approval required
•Randomized, placebo-controlled, doubleblind clinical trials not required
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Substantiation Standard:
•“truthful and not misleading”
21 U.S.C. § 343(r)(6)(B)
Regulatory Background:
Structure-Function v. Disease Claims
“describe[] the role of a nutrient or dietary
ingredient intended to affect the structure or
function in humans,” 21 U.S.C. § 343(r)(6)(A)
“not claim[ed] to diagnose, mitigate, treat,
cure, or prevent a specific disease or class of
diseases,” 21 U.S.C. § 343(r)(6)
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Regulatory Background: FTC Guidance
“CARSE”
“‘Competent and reliable scientific evidence’
means tests, analyses, research, studies, or other
evidence based on the expertise of professionals
in the relevant area, that has been conducted and
evaluated in an objective manner by persons
qualified to do so, using procedures generally
accepted in the profession to yield accurate and
reliable results.”
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Regulatory Background: FTC Guidance
“There is no fixed formula for the number
or type of studies required . . .” (p. 9).
“There is no set protocol for how to
conduct research that will be acceptable
under the FTC substantiation doctrine.”
(p. 12).
“The FTC’s standard for evaluating
substantiation is sufficiently flexible to
ensure that consumers have access to
information about emerging areas of
science” (p. 8).
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II. FTC Attempt To Raise Standard
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1
Entered into consent decrees with language and
definition identical to FTC Guidance (CARSE)
2
Lost cases under this standard
3
David Vladeck: “Our experience in bringing
enforcement and contempt actions in federal courts
suggests that we need to take steps to make our
standard injunctive language. . . more exact”
FTC Strong-Arms Higher Standard Through
Consent Decrees
• “[T]wo adequate and well-controlled human
clinical studies. . .”
• “Such study shall be randomized, and, unless it
can be demonstrated that blinding or placebo
control cannot be effectively or ethically
implemented given the nature of the intervention,
shall be doubleblind and placebo-controlled.”
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Two Failed Attempts To Raise Standard
Through Litigation
FTC v. Garden of Life,
845 F. Supp. 2d 1328, 1335 (S.D.
Fla. 2012), aff’d in part and
vacated in part, 516 F. App’x 852
(11th Cir. 2013)
Basic Research v.
FTC,
No. 2:09-cv-0779 at 26-27
(D. Utah Nov. 25, 2014)
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When a consent decree speaks only
of “competent and reliable scientific
evidence,” the government cannot redefine
it through expert testimony and “require
[the] court to read additional requirements
into the Consent Decree.”
By demanding “gold standard” clinical
trials, which “exceed the requirements
of the [consent decree],” the
government failed the “expectation
of reasonableness.”
III. United States v. Bayer
Process
I.
Multi-Year Investigation
II.
Refusal To Settle
III.
FTC Referral to DOJ
IV.
Contempt Motion (seeking hundreds of millions of dollars)
V.
Expedited Discovery (Bilateral, now)
VI.
Bench Trial (focused largely on expert testimony)
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Based on “novel and
unlawful” standard
US v. Bayer: Background
“‘Competent and reliable scientific evidence’ means tests,
analyses, research, studies, or other evidence based on the
expertise of professionals in the relevant area, that has been
conducted and evaluated in an objective manner by persons
qualified to do so, using procedures generally accepted in the
profession to yield accurate and reliable results.”
Bayer Consent
Decree
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FTC Guidance
“To Promote Overall
Digestive Health”
“Helps Defend Against
Occasional:
•Constipation
•Diarrhea
•Gas and Bloating”
“This product is not intended
to diagnose, treat, cure, or
prevent any disease”
35
Government’s Position In Litigation
DSHEA is irrelevant
FDA regulations and guidance are irrelevant
Structure-function category is irrelevant
Refused to concede that FTC Guidance and consent
decree were identical
Single expert can decide standard for industry
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Evidence At Trial
37
Government Expert Testimony Conflicted
With FTC Guidance
Government Experts
FTC Guidance
Specific eight-part protocol
“[N]o set protocol”
“Highest quality” and “Level 1”
RCT
“[S]ufficiently flexible to ensure . . . access to
information about emerging areas of science.”
No animal or in vitro
“Animal and in vitro will also be
examined”
Same 3-strain product
May use “similar formulation”
Same population
May “extrapolate”
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Government Failed to Inform Expert of
Laws & Regulations
Law & Regulation
Not Informed
FTC Guidance
“I actually did not rely on it or look at it
when I made my original report.”
Dietary Supplement Law
FDA Regulations
Structure/Function Rules
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“[I] had not heard of the statute” at
“the time that [I] provided [my] report
in September, 2014”
“did not review or consider [] FDA
regulations in any way to the extent
they might have been relevant”
“I had not been informed by the FTC or
DOJ about structure function claims
related to this, no.”
Government “Expert” Lacked Necessary
Expertise
Q: You are not an expert in probiotics, we
can agree on that, can’t we?
A: Yes.
Q: You do not hold yourself out as an expert
on dietary supplements?
A: That is correct.
Does not regularly use probiotics in clinical
practice.
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Bayer’s Experts
Dr. Merenstein
Dr. Fennerty
Leading expert in probiotics.
Lead investigator on 8 probiotic trials
Member of ISAPP Expert Consensus Panel
Conducts research on probiotics and gut
microbiome
Has recommended probiotics to
thousands of patients
Has recommended probiotics to
thousands of patients for over 20 years
Familiar with and understands scientific
literature on probiotics
Familiar with hundreds of probiotic
studies before being retained.
41
Bayer’s Expert Testimony
1. Overwhelming
“competent and reliable
scientific evidence” for
Bayer’s claims
2. Experts do not expect
drug-level randomized
controlled-clinical trials
42
Court’s Opinion
• Denied Government’s contempt motion
• No violation of court order
• Rejected attempt to raise the standard
• No damages, penalties, or fines
• Reasoning, currently under seal
43
IV. Lessons Learned
• Put government to its proof: Try more cases
• Discovery against government
• Rely on strong experts (before and during litigation)
• Scientific substantiation
• Industry can win
44
UPDATE FROM FTC ON
REGULATION OF OTC PRODUCT
PROMOTION
FDLI’s Advertising and Promotion Conference
October 2, 2015
Ivan Wasserman
Manatt ,Phelps & Phillips
202-585-6529
[email protected]
Gregory W. Fortsch: Attorney,
Division of Advertising Practices
Richard L. Cleland: Assistant
Director, Division of Advertising
Practices
Michelle Rusk: Senior Staff
Attorney, Division of Advertising
Practices
* Special Rules?
* Many ways to prove “effectiveness”?
* Disclaimers?
* Traditional Use?
* Experts in the field?
UPDATE FROM FTC ON
REGULATION OF OTC PRODUCT
PROMOTION
FDLI’s Advertising and Promotion Conference
October 2, 2015
Ivan Wasserman
Manatt , Phelps & Phillips
202-585-6529
[email protected]
Questions?
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