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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 1 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 25 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 26 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) 27 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.” 28 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). 29 II. FTC Attempt To Raise Standard 30 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.” 31 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) 32 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) 33 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 34 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 36 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” 38 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 39 “[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. 40 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? 54