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The Preemption WarWhen Federal Bureaucracies Trump Local Juries
By Thomas O. McGarity
Yale University PressCopyright © 2008 Thomas O. McGarity
All right reserved.
Susan Halvorsen and her husband, Jim Gjebic, had planned to spend a quiet Labor Day weekend relaxing at their Grosse Pointe, Michigan, home. The weekend got off to a great start with dinner and a movie but took a minor turn for the worse just before bedtime, when Jim felt a pain in his right thigh. Susan handed him the bottle of Vioxx that he had been taking for his rheumatoid arthritis, a somewhat rare affliction for a healthy thirty-four-year-old like Jim. He told her that he would join her after the pain subsided, and he returned to the living room while she fell asleep. When Susan awoke the next morning, she discovered that Jim had not returned to the bedroom. Hurrying to the living room, she found him sitting upright on the couch, where he had died overnight of a heart attack.
Susan spent the next few years adapting to her new life as a widow and trying to reconcile Jim's death with her nagging conviction that "[p]eople don't die when they're 34 years old and have arthritis." The unresolved mystery of Jim's death plagued her until September 2004, when she learned that Merck Pharmaceutical Corporation had just voluntarily withdrawn Vioxx from the market because a recentclinical study had concluded that the painkiller greatly increased the risk of heart attacks in people taking it at high doses.
SUSAN HALVORSEN'S SURPRISE
Like thousands of heart disease victims and their spouses throughout the country, Susan Halvorsen sought legal counsel in the hope of receiving compensation for Jim's loss and some degree of retribution from the large multinational corporation that, she was now convinced, had caused his untimely death. A lawyer should not have been hard to find. By early 2005, lawsuits had been filed in Alabama, California, Mississippi, New Jersey, Texas, and a number of other states, and a quick Internet search would have revealed dozens of websites inviting visitors to consult with attorneys who specialized in suing drug companies on behalf of ordinary folks like Susan. Upon contacting a Michigan lawyer, however, Susan learned to her great dismay that her lawsuit was a nonstarter, not because of something she or Jim had done but because of a law that the Michigan legislature had enacted in 1995 as part of a "tort reform" package aimed at protecting a large Detroit drug company from alleged "lawsuit abuse."
The Michigan statute shields from liability the manufacturer of a drug that the United States Food and Drug Administration (FDA) has approved for safety and efficacy if the drug and its labeling comply with FDA-imposed requirements and the manufacturer did not bribe an FDA official or withhold critical required information from FDA at the time of approval. By the time that Susan sought legal advice, state and federal courts had already turned away several plaintiffs in Michigan cases involving different drugs, and a federal court of appeals had held that the law did not infringe upon the rights of Michigan citizens under the United States Constitution to due process of law and jury trial. Consequently, while lawyers for equally situated widows throughout the country were aggressively pursuing their claims, Susan was left to reflect bitterly upon her uncompensated (and unavenged) loss at the hands of what she believed to be a callous corporation that had earned billions of dollars in profits from sales of a heavily promoted but deceptively dangerous drug.
A year later, the same federal agency that had granted "fast track" approval to Vioxx in 1999 proposed to alleviate the gross inequity that vexed Susan Halvorsen. Tucked away in the seventy-seven pages of fine print in the preamble to its long-dormant but hastily revived regulations governing prescription drug labels, FDA eliminated that inequity by taking away the rights of the citizens of all states to sue for damages resulting from a company's alleged mislabeling of an FDA-approved drug. Susan Halvorsen could now perhaps take some mild comfort in the knowledge that what the State of Michigan had denied to her, the federal government was now attempting to take away from all of the other similarly situated widows in the country.
PREEMPTION IN THE GEORGE W. BUSH ADMINISTRATION
In technical terms, the language in the FDA preamble expressed the agency's position that any lawsuits brought by plaintiffs against manufacturers of FDA-approved drugs for failure to warn doctors and patients of hazardous side effects would be "preempted" by the federal Food Drug and Cosmetics Act (FDC Act). Under the Supremacy Clause of the United States Constitution, laws enacted by Congress are the "supreme Law of the Land" and are thereby binding on both federal and state judges, state laws "to the contrary notwithstanding." Although the federal law that FDA administers does not in so many words empower FDA to declare state laws null and void, the Supreme Court of the United States has interpreted the Supremacy Clause to "impliedly" preempt state laws, regulations, and common law claims that are inconsistent with federal statutes and regulations. Moreover, many federal courts have deferred to the views expressed by the agencies promulgating the relevant federal regulations in deciding whether they preempt state laws. Hence, FDA's claim that its "approval of labeling under the [FDCA] preempts conflicting or contrary State law," including state common law claims, was of no minor consequence to the attorneys filing lawsuits against Merck for damages caused by Vioxx.
FDA's preemption statement quietly implemented an important component of a longstanding and ambitious domestic policy agenda of the American business community and the Republican Party. As a presidential candidate, George W. Bush had made "tort reform" a major theme of his election campaign of 2000, and he frequently alluded in subsequent years to a "lawsuit crisis" that, he maintained, was threatening the economic vitality of American businesses and professional people by driving up their insurance costs and forcing them to engage in wasteful and expensive "defensive" practices. As a former businessman who had personally experienced the threat of lawsuits and whose friends headed companies that had been forced to pay millions of dollars in compensation to victims of alleged negligent business practices and poorly designed products, President Bush was quite receptive to the business community's demands for relief from "vexatious" litigation.
Candidate Bush's long-time political guru, Karl Rove, had over the years successfully turned the business community's arcane appeal for "tort reform" into a potent political tool for winning the votes of populist conservatives and, more important, for persuading wealthy campaign contributors to open their wallets for the candidates he advised. As a $3,000-per-month consultant to the Philip Morris Company during the tobacco industry's successful tort reform efforts during George W. Bush's first term as governor of Texas, Rove had become steeped in the issues, and he soon discovered the "utility of frivolous and junk suits as a political issue." Later, during the 2000 presidential campaign, as a few fortunate private plaintiffs' attorneys were bringing in huge contingency fees from multibillion-dollar settlements in state litigation against the tobacco industry, candidate Bush discovered that forceful attacks on "greedy trial lawyers" had a degree of political salience that support for the business community's liability avoidance initiatives lacked.
After the 2002 elections put the Republican Party firmly in control of both houses of Congress and solidified President Bush's political leadership, the prospect for "tort reform" at the federal level brightened considerably. Vigorously opposed by most Democrats, however, the administration's omnibus "lawsuit reform" initiative went nowhere during the 108th Congress. With a few modest single-issue exceptions, most of which related directly or indirectly to national security, the business community's demands for legislation protecting companies from state common law litigation died in Congress.
As the legislative proposals languished in Congress, presidential appointees in several federal regulatory agencies launched a much less visible initiative to curb lawsuits involving products and activities regulated by the federal government. At the same time that they were reducing the stringency of federal regulations, those federal agencies urged courts to dismiss common law claims against regulated companies on the ground that they were preempted by the same federal regulations. The Chief Counsel of the FDA even went so far as to encourage defense counsel to urge courts to request amicus curiae, or "friend of the court," briefs from FDA so that he could come to their aid. Emboldened by some initial judicial receptivity to these overtures, several agencies began to tuck preemption statements into their Federal Register notices.
In these administrative, legislative, and judicial battles at the federal level, the traditional opponents of "tort reform" (consumer advocates and plaintiffs' attorneys) have been joined by representatives of the state and local governments who oppose "one-size-fits-all" regulatory requirements emanating from the federal government. These state officials stress that the unique brand of federalism that has grown up over more than two hundred years in the United States protects diversity and encourages innovation by allowing the states to function as "laboratories" for testing new governmental theories and programs like the Michigan tort reform legislation. If Michigan decides to limit the rights of its citizens to recover damages caused by federally approved drugs, that is Michigan's business. The legislation may be wise or it may be dumbfoundingly misconceived, but it can always be changed by the citizens of Michigan through legislative action. If the federal FDA successfully implements the preemption provisions of its labeling regulations, it will have imposed the policy preferences of the upper-level bureaucrats of a single federal agency on all of the citizens of all of the states, and change will be possible only through the painfully slow process of electing a new president with different policy preferences, lobbying the new administration to overrule the previous FDA position, and urging the revised position on state and federal courts. The Supreme Court of the United States will resolve this issue in the very near future.
These developments might not be troublesome if members of the general public could trust the federal agencies administering preemptive regulatory programs to perform the protective roles that Congress has assigned to them vigorously and competently. Unfortunately, the hortatory goals of the federal statutes are rarely matched by the realities of public administration in a regulatory world in which agencies constrained by limited resources are often overwhelmed by powerful economic and political interests. To the extent that the regulatory protections afforded by federal agencies are imperfect, society as a whole is the loser when federal preemption deprives the common law of its well-documented ability to "send a message" to potential wrongdoers. The regulatory history of the painkiller that Susan Halvorsen's husband took just before he died provides a useful case study in the perils of relying exclusively upon federal regulatory agencies to protect consumers from fraud and risks to their health and safety.
VIOXX AND THE REALITIES OF REGULATORY PROTECTIONS
No one knows for sure whether Vioxx killed Jim Gjebic. Thanks to the lawsuits that lawyers for alleged Vioxx victims brought in other states, however, we do know a great deal about how FDA approved Vioxx and allowed it to remain on the market, even as evidence mounted that it caused heart disease in a substantial percentage of the people taking it for pain relief. Vioxx was one of a class of "designer drugs" developed during the 1990s to address specific scientifically identified causes of human disease. In the early 1990s, UCLA scientists searching for genetic causes of cancer discovered a human gene that produced an enzyme that was very similar to cyclooxygenase (COX), an enzyme that inspires the human body to produce several chemicals that contribute to pain, in- flammation, and fever. The two enzymes were in fact so similar that scientists dubbed them COX-1 and COX-2. Soon thereafter, Dr. Philip Needleman, a scientist at Washington University in St. Louis, made an even more interesting discovery. Whereas the COX-1 enzyme is always in the human body and helps protect sensitive tissues in the stomach lining, the COX-2 enzyme is produced mostly during times of fever and inflammation. A drug that could inhibit COX-2 production without unduly inhibiting COX-1 production would therefore become an attractive alternative to other highly successful nonsteroidal anti-inflammatory drugs (NSAIDs), like naproxen (Aleve) and ibuprofen (Advil, Motrin), that irritate stomach linings in many people, cause bleeding ulcers in some people, and have resulted in the premature deaths of a few older arthritis patients who were also using blood thinners.
FDA Regulation of Vioxx
After moving to the Searle pharmaceutical division of the nearby Monsanto Corporation, Needleman quickly discovered that the drug celecoxib (Celebrex) would do the job. Soon thereafter, scientists at the Merck Corporation discovered another COX-2 inhibitor called rofecoxib (Vioxx) that appeared to work just as well as celecoxib. Merck and the Pfizer Corporation (which had purchased the Searle assets, including the right to produce Celebrex) now pressed FDA to grant "fast track" approval to the new drugs under a program established in 1988 for speeding up approvals of drugs that could prevent life-threatening or severely debilitating diseases like AIDS. The agency approved Celebrex in October 1998 and Vioxx in May 1999, both within six months of receiving the applications. Having put the COX-2-inhibiting drugs on a "fast track" because of their capacity to reduce potentially life-threatening gastrointestinal bleeding, however, the agency concluded that the companies had not proven them effective for that purpose, and it required their labels to contain the standard warning (already included on the NSAID drugs) about that side effect.
Merck then sponsored additional clinical studies aimed at demonstrating that Vioxx did in fact produce a lower incidence of gastrointestinal bleeding than did other NSAID drugs. The largest of those studies, an eight-thousand-person clinical trial called the Vioxx Gastrointestinal Outcomes Research (VIGOR) study, compared Vioxx to naproxen over an eighteen-month period. The study concluded that Vioxx did reduce the incidence of gastrointestinal problems, but it also found a four- to five-fold increase in the incidence of cardiovascular problems in the patients taking Vioxx. These results, which were shared with FDA and published in the New England Journal of Medicine, were consistent with a theory published by Dr. Garret A. FitzGerald in 1998 suggesting that COX-2 inhibitors, by constricting blood vessels and activating bloodclotting platelets, could cause heart attacks. Merck's public position, however, was that the difference in the incidence of adverse cardiovascular events was attributable exclusively to naproxen's ability to suppress heart disease and not to any potential that Vioxx might have to cause cardiovascular problems. Soon after receiving the VIGOR results, Merck issued a press release entitled "Merck Confirms Favorable Cardiovascular Safety Profile of Vioxx," in which it set out its position on the VIGOR study and explained that other trials had found "no difference in the incidence of cardiovascular events" between Vioxx and a placebo or other painkillers.
The VIGOR study convinced FDA to allow Merck to remove the gastrointestinal warning from the Vioxx label, and it was off to the races for the newest blockbuster drug. Taking advantage of 1997 changes in FDA's rules for marketing prescription drugs, both Merck and Pfizer aimed aggressive marketing campaigns directly at consumers, rather than at the doctors who wrote the prescriptions for the drugs' use. Merck's $195 million advertising campaign, featuring the former Olympic skating champion Dorothy Hamill, targeted the large population of increasingly arthritic baby boomers, rather than the population (the parents of the baby boomers) most likely to benefit from its unique ability to prevent gastrointestinal bleeding. The ads, which did not mention the risk of heart attacks, propelled sales of both drugs to blockbuster status. Before things turned sour, more than twenty million people had taken Vioxx, and Merck was grossing $2 billion in annual sales from the product.
Excerpted from The Preemption War by Thomas O. McGarity Copyright © 2008 by Thomas O. McGarity. Excerpted by permission.
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