An impossible course: navigating the generic drug label delay

In May 2016, the FDA put off until 2017 a decision about a Final rule that would allow generic drug companies to update their labels with new safety information similar to their reference product counterparts. This marks the third time since the FDA proposed the rule that it has been shelved in the face of opposition from the pharmaceutical industry and some lawmakers. The delay, with major ramifications for consumers and industry alike, was initially discovered in an update to a timetable for the rule and officially appeared in a Federal Register Notice in mid-June. The development dismayed consumer groups and representatives for trial lawyers, who had urged the agency to close a legal loophole that prevents patients harmed by generic drugs from suing manufacturers.

Unlike brand-name drug makers, generic drug makers are not permitted to make changes to a drug’s label without the FDA’s approval unless the brand name drug maker makes the label change first. Instead, generic drug makers must wait for the FDA to order them to change their label. Since the passage of the Drug Price Competition and Patent Term Restoration Act (P.L. 98-417) in 1984, known as the Hatch-Waxman Act, the FDA has approved over 8,000 generic drugs. The Hatch-Waxman Act provides an expedited approval process for generic drugs that have an identical reference listed drug (RLD). As a result, nearly nine in 10 prescriptions filled today in the U.S. are for generic drugs, yet only account for 28 percent of drug expenditures.

Two Supreme Court decisions have helped to establish the conflicting division faced by patients and drug makers regarding drug label. Under the federal Food, Drug, and Cosmetic Act (FDC Act) and the subsequent Hatch-Waxman Act amendments, a generic drug company “may not unilaterally change its labeling or change its design or formulation and cannot be required to exit the market or accept state tort liability.” Consequently, a state law is preempted in the event a generic drug manufacturer must take one of the aforementioned actions to comply with a state law duty. Thus, patients taking a generic prescription drug are unable to recover for alleged injuries from either the brand name or generic drug maker. The brand name drug maker is not liable because it did not sell the drug directly to the patient and the generic drug maker faces the “impossibility” of providing updates to the drug label without direction from the brand name drug maker.

This White Paper provides an overview of the laws and regulations establishing the foundation of drug labels. The White Paper will also discuss the impact of the Supreme Court decisions on consumers’ ability to sue a drug maker for its drug labels. Finally, this White Paper examines whether industry pressure or consumer sentiment will carry the day. As the public service announcement from the FDA attests, it may be difficult to get generic drug approval, but as follows in this White Paper, generic drug makers are also harder to sue.

Read further: “An impossible course: navigating the generic drug label delay.”