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By: Kristian Smith
Last month, a federal jury in Massachusetts acquitted two executives of medical device company Acclarent, Inc. of 14 felony counts of fraud related to off-label promotion of Acclarent’s “Stratus” device. United States v. Facteau, et al. stemmed from the distribution of Acclarent’s Relieva Stratus Microflow Spacer (“Stratus”) for off-label use. Although Stratus was cleared by the FDA as a medical device intended to maintain an opening to a patient’s sinus and provide moisture by using a saline solution, Acclarent’s CEO, William Facteau, and Vice President of Sales, Patrick Fabian, promoted the product off-label, as a steroid delivery device. The FDA claimed that Facteau and Fabian had misbranded the device and had committed fraud on the FDA by intending to use the device in a way other than its cleared use.
Although Facteau and Fabian were convicted on 10 misdemeanor counts relating to the same charges, the jury still accepted that it is not a crime for device manufacturers to make truthful, non-misleading statements about off-label use. The jury instead convicted Facteau and Fabian based on their conduct, mainly because of a violation of the Park Doctrine, which provides that responsible corporate officers can be liable for misdemeanor violations of the Federal Food, Drug and Cosmetic Act (“FDCA”) even if the corporate officer had no intent to commit, or even knowledge of, the offense.
This is only one of many recent victories for medical device companies in the off-label promotion realm.
In February, a Texas jury acquitted medical-device manufacturer Vascular Solutions and its CEO of all counts in a criminal case that alleged the company illegally promoted Vari-Lase, a device to treat varicose veins, off-label. The Vascular Solutions case was particularly memorable for the trial judge’s jury instruction that it is not a crime for a device company to provide doctors with truthful, non-misleading information about off-label product uses. This was a significant blow to the FDA’s long-standing practice of discouraging (and prosecuting) off-label promotion.
In 2015, in Amarin Pharma, Inc. v. FDA, a federal judge in New York found that Amarin, a drug manufacturer, was entitled to engage in truthful and non-misleading speech promoting the off-label use of its medical device, and such speech could not form the basis of a prosecution for misbranding. This decision was based in large part on the Second Circuit’s 2012 watershed decision in U.S. v. Caronia, where the Court held that to avoid infringing on the First Amendment, misbranding provisions of the FDCA could not be construed to prohibit and criminalize truthful off-label promotion of FDA-approved drugs.
Even with more and more federal courts embracing Caronia, the FDA continues to prosecute drug and device manufacturers (and their corporate officers) for off-label promotion. With the decisions in Facteau and Vascular Solutions, though, it looks like the FDA will have a more difficult path to prosecution than ever before.