Petition — Alcon Laboratories (Puerto Rico), Inc. v. United States
Supreme Court brief1981
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Office- Supreme Court, U.S.
oe RFILE®
50-1607 MAR 23 1981
be SANOER L. STEVAS,
|
IN THE
Supreme Court of the United Ptates
OCTOBER TERM, 1980
ALCON LABORATORIES (PUERTO RICO), INC., EDGAR H.
SCHOLLMAIER, and JOHN W. FEIK, Petitioners
Vv.
UNITED STATES OF AMERICA, Respondent
PETITION FOR A WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
THOMAS QO. HENTELEFF
GLENN E. DAVIs
KLEINFELD, KAPLAN & BECKER
1140 Nineteenth Street, N.W.
Washington, D.C. 20036
(202) 223-5120
Counsel For Petitioners
Of Counsel:
MANUEL A. GUZMAN
McCOoNNELL VALDES KELLEY
StFRE GriGGS & RuUIZ-SURIA
G.P.O. Box 4225
San Juan, Puerto Rico 00936
PETER R. MATHERS
KLEINFELD, KAPLAN & BECKER
1140 Nineteenth Street, N.W.
Washington, D.C. 20036
March 23, 1981
LA ALLL TTR SARNIA AN RNARTETRORRI ICY SAT
PRESS OF BYRON S. ADAMS PRINTING, INC., WASHINGTON, D.C.
QUESTIONS PRESENTED
1. Whether a District Court has authority in a ‘‘new
drug’’ enforcement action arising under the Federal
Food, Drug, and Cosmetic Act to remand the case
before it to the primary jurisdiction of the Food and
Drug Administration for a formal administrative deter-
mination of the ‘‘new drug’’ status of the drug at issue.
2. Whether in a ‘‘new drug’’ enforcement action
arising under the Federal Food, Drug, and Cosmetic Act
a District Court has authority to direct the Food and
Drug Administration to defer further enforcement action
pending a remand of the ‘‘new drug”’ issues to the Food
and Drug Administration.
3. Whether a remand order in an enforcement ac-
tion under the Federal Food, Drug, and Cosmetic Act
constitutes an order in abatement within the meaning of
28 U.S.C. §2105 so as to preclude review or reversal of
it by a Court of Appeals.
ill
TABLE OF CONTENTS
PAGE
Oreos BROW «oc. soo eens snes l
FURMICTION oon cv id k's Sw ce enact eee eee 2
STATUTORY PROVISIONS INVOLVED............0.0e0eeee 2
STraTamant Or Tit CAS oo... 5. 0s oo ssenne eee 2
REASONS FoR GRANTING THE PETITION ................ 1]
1. The Decision Below Conflicts With The Deci-
sions Of This Court Which State That A Court
Can Remand The ‘‘New Drug’’ Issues In An
Enforcement Proceeding To The Primary
Jurisdiction Of The Food And Drug Admin-
IStFAtiON.... .. .ossinekeeeTte a awe ee 1]
2. The Decision Below Conflicts With The Deci-
sions Of This Court And Of Another Court Of
Appeals Which Indicate That A Court Can En-
join Further Enforcement Action By The Food
And Drug Administration Pending A Remand
To That Agency For Determination Of The
“New Etug’” ISMGS .. i. cvacsss eee eee eee 17
3. The Decision Below Violates 28 U.S.C. §2105
And Presents Important Questions Of First Im-
pression Concerning Federal Appellate Jurisdic-
tion Over Orders In Abatement .............. 23
CONCLUSION. o.s.0 cece s ees nace ba dep ook de nanan 27
APPENDICES:
A. Opinion Of The Court Of Appeals, February
ye >.) PPA la
B. Judgment Of The Court Of Appeals, February
ZA, 1961... cece cewne dies eine ae 24a
C. Order Of The District Court, February 27, 1980 25a
D. Opinion And Order Of The District Court,
April 9, 1900 ....60ssscsennane eee 27a
E. Order Of The District Court, April 29, 1980... 34a
F. Pertinent Provisions Of The Federal Food,
Drug, And Cosmetic Act ........ccsccccceces 37a
PREVIOUS PAGE WAS BLANK |
0 oe
iV
TABLE OF AUTHORITIES
CASES:
Aetna State Bank vy. Altheimer, 430 F.2d 750 (7th
Ce Per EG oes 245s DENK aaah Mauun ey aaies
American Federation of Musicians v. Wittstein, 379
BR Geo, 2, apa a pararene oareeie rary ee 24
Bentex Pharmaceuticals, Inc. v. Richardson, 463
fk ey Le ey a ec 20
Bowles v. Wilke, 175 F.2d 35 (7th Cir. 1949)....... 25
CIBA Corp. v. Weinberger, 412 U.S. 640 (1973) 7, 11-15
Cohen v. Beneficial Industrial Loan Corp., 337 U.S.
EE MOE acdsee oe kk hee en eer Ss 10, 24
Ewing v. Mytinger & Casselberry, Inc., 339 U.S. 594
NGG nn na aed Pauw eased as 10, 18-20, 22-23
Firestone Tire & Rubber Co. v. Risjord, 101 S.Ct.
2 Rr Sere erry errr err 24
ICC v. B & T Transportation Co., 613 F.2d 1182
Se I acc vee ee eee oe eee 11
IMS Ltd. v. Califano, 453 F. Supp. 157 (C.D. Cal.
gc: SRR RRO eer gee urn p are purine aes 13-14
National Remedy Co. v. Hyde, 50 F.2d 1066 (D.C.
er UE Sle ac Ras eee AO Rea ks 20
Rutherford v. United States, 542 F.2d 1137 (10th
458 Aap ESOP Oier eater OL oer nan) Lean? 14-15, 21
Securities & Exch. Com’n vy. United Ben. L. Ins.
eM ce Ae Oo) 17
United States v. Articles of Drug... WANS, No.
Pan ae CAP a Es Fe SUED xv cnn hdcnv anda
Upjohn Co. v. Finch, 303 F. Supp. 241 (W.D.
I SA Sok ane pc eeSic vane Cele ce uvew es 21
Victrylite Candle Co. v. Brannan, 201 F.2d 206
bc BE ss cand eae ONes toe eek eegb ews es 20
Weinberger v. Bentex Pharmaceuticals, Inc., 412
op 2. re Bee eee as 11, 13-15, 17, 20-21
Table of Authorities Continued
STATUTES AND REGULATIONS:
Federal Food, Drug, and Cosmetic Act
Se HD ms ax ee Baha Se Sas Shes ees 3
DS SE ok Cc ia eas uence sevates ve 3
PR ec knw ok sd tons Ko aos. asa oe 2, 19
DSIRE So Gen ck na eecevcentacer aces 19
ye RE Rr ar rer eee 19
oan at nih ahs kk & Riccee
na sara wee ORO kd See eee
eR EE aS as easy Fi StS a hee oe Th k de oo es 21
ty a po Parana ae one ra 2
eS I Cao ae wi isp oan BP EA lew eral ee 9, 24
Ne a6 ohh tb Oban hoes al eae 10, 17
eS OE Sob W ui vicina 4-c0c45 8 eee 9-10, 17, 23-27
FDA Compliance Policy Guide 7132c.08 .......... 3
ee I ie ceca sin eek Wed S vate ade ane ee he 16
ee EE i's 6 oi os 404.540 K SEEDS SO RARSD
es I ig 6000s 950805008 n eo aes 3
Be Rte SONS Wade ewbebdsivadsaracuriowens 16
MISCELLANEOUS:
1 Am. Jur. 2d Abatement, Survival, and Revival §1
Peet ir OG urea as a dak 2% 25
1 C.J.S. Abatement and Revival §1 (1936)......... 25
1 C.J.S. Abatement and Revival §7 (1936) ......... 25
ee i re oe a re 16
15 Wright, Miller & Cooper, FEDERAL PRACTICE
AND PROCEDURE §3903 (1976) .............. 24, 26
IN THE
Supreme Court of the United States
OcToBER TERM, 1980
No.
ALCON LABORATORIES (PUERTO RICO), INC.,' EDGAR H.
SCHOLLMAIER, and JOHN W. FEIK, Petitioners
V.
UNITED STATES OF AMERICA, Respondent
PETITION FOR A WRIT OF CERTIORARI TO
THE UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
Alcon Laboratories (Puerto Rico), Inc., Edgar H.
Schollmaier, and John W. Feik petition for a writ of
certiorari to review the opinion and judgment of the
United States Court of Appeals for the First Circuit.
OPINIONS BELOW
The opinion (App. A, infra, la-23a) and judgment
(App. B, infra, 24a) of the United States Court of Ap-
peals for the First Circuit are unreported. The February
27, 1980 remand Order of the United States District
Court for the District of Puerto Rico (App. C, infra,
25a-26a) is unreported. The April 9, 1980 Opinion and
Order of the District Court (App. D, infra, 27a-33a) is
' Pursuant to Rule 28.1 of the Rules of this Court, the parent
companies, non-wholly owned subsidiaries, and affiliates of Alcon
Laboratories (Puerto Rico), Inc. are Alcon Laboratories, Inc. and
Nestle S.A.
2
unreported. The April 29, 1980 Order of the District
Court (App. E, infra, 34a-36a) clarifying the District
Court’s two previous orders is unreported.
JURISDICTION
The opinion of the Court of Appeals vacating the
Orders of the District Court was rendered February 24,
1981. The jurisdiction of this Court is invoked under 28
U.S.C. §1254(1).
STATUTORY PROVISIONS INVOLVED
The pertinent provisions of the Federal Food, Drug,
and Cosmetic Act (hereinafter ‘‘FFDCA”’’) are set forth
in Appendix F, infra, 37a-42a.
STATEMENT OF THE CASE
This case concerns the regulatory status of the
prescription drug WANS, an antiemetic (antivomiting)
drug marketed by the petitioner, Alcon Laboratories
(Puerto Rico), Inc.? Two of the three underlying con-
solidated actions are drug seizure actions under the
FFDCA. These actions were filed in the District Court
by the Federal Food and Drug Administration (‘‘FDA’’)
on September 21, 1978 and January 28, 1980, respective-
ly, with the FDA invoking 21 U.S.C. §334 (the
‘‘seizure’’ provisions of the FFDCA, App. F, infra,
37a-38a) for jurisdiction. The third action, filed with the
District Court on November 28, 1978, is an action in
which the FDA seeks to enjoin Alcon from introducing
WANS into interstate commerce without first obtaining
? The other petitioners, Edgar H. Schollmaier and John W. Feik,
are employees of Alcon Laboratories (Puerto Rico), Inc. The
petitioners will be referred to collectively as ‘‘Alcon.’’
—
a
3
an approved new drug application (‘‘NDA’’) for WANS.
Jurisdiction in this action was invoked under 21 U.S.C.
§332 (the injunction provisions of the FFDCA, App. F,
infra, 38a-39a). All of these actions are based upon
FDA’s allegation that WANS is an unapproved ‘‘new
drug’’’ and as such cannot be marketed in interstate
commerce without violating the ‘‘new drug’’ provisions
(21 U.S.C. §355, App. F, infra, 40a) of the FFDCA. In
each of these actions, Alcon has denied that WANS is a
‘‘new drug’’ and has affirmatively asserted that WANS
is entitled to ‘‘grandfather’’ protection (App. F, infra,
39a-4la), and that the enforcement actions against
WANS based upon its alleged ‘‘new drug”’ status violate
the FDA’s Compliance Policy Guide 7132c.08 (‘“CPG’’).
The CPG is an advisory opinion/guideline which is made
binding upon the FDA by its own regulations. See 21
CFR §§10.85 and 10.90.
Each of the WANS preparations (WANS No. 1,
WANS No. 2, and WANS Children) is in a suppository
dosage form and each contains as its active ingredients
pyrilamine maleate and pentobarbital sodium. These in-
gredients are widely used by the medical profession in
treating various disease conditions. The WANS prepara-
tions were first marketed in 1955 and since then have
been continuously available to the medical profession as
prescription drugs for use in the symptomatic treatment
of uncontrolled vomiting.
Prior to WANS’ introduction in 1955, it was deter-
mined that it was not a ‘‘new drug’’ as that term was
then defined under the 1938 Act (i.e., it was generally
recognized as safe). Based upon this determination,
Alcon’s predecessor in interest in WANS did not file an
’ A “‘new drug”’ is defined in 21 U.S.C. §321(p) (App. F., infra,
39a-4la).
NDA, but rather marketed WANS as an ‘‘old drug.’’
Several other companies reached a similar conclusion
and marketed antiemetic preparations similar to WANS
as ‘‘old drugs.”” WANS was marketed by Alcon from
1955 to 1978 with no questions being raised by FDA
concerning the need for pre-market approval by the
agency.
On March 17, 1978, 23 years after the product was
first introduced into interstate commerce, FDA sent a
Regulatory Letter to Alcon alleging for the first time
that WANS is a ‘‘new drug’’ and requesting that Alcon
discontinue marketing its product until it had obtained
an approval from FDA. The Regulatory Letter also
raised and attempted to deal with a formidable obstacle
to regulatory action, the CPG. The Regulatory Letter
stated:
Please note that as listed in the CPG, your pro-
duct(s) would fall under Part B ‘‘DESI and other
Prescription Drugs where a final determination has
not been made.’’ Ordinarily, drugs subject to this
part of the CPG are not scheduled to be covered
under a class action until a later time. However, as
further explained in the above-mentioned document,
it is Agency policy to initiate regulatory action
against a violative product outside the established
priorities when such product becomes violative
under another provision of the Act, or if we receive
significant new information which questions the
safety and efficacy of the drug. (Please see Policy
Guideline Exceptions #2, Page 5). Consequently
because of new information concerning the safety
and efficacy of these drugs, we are initiating
regulatory action at this time.
(emphasis added.) The sole ground for proceeding at this
time against the class of drugs encompassing WANS was
stated to be ‘‘new information concerning the safety and
5
efficacy of these drugs. . .”’ i.e.,,the ‘‘significant new in-
formation’’ exception to the regulatory priorities
established in the CPG.
In FDA’s Regulatory Letter, the ‘‘significant new
information’? was said to consist of alleged reports of
‘“severe and sometimes fatal reactions’’ with drugs con-
taining pyrilamine maleate and pentobarbital, and the
purported ‘‘conclusion’? of the FDA’s Neurological
Drugs Advisory Committee that there is no evidence of
the safety or efficacy of drugs containing pyrilamine
maleate with or without a barbiturate in the treatment of
nausea and vomiting.
Following ‘he issuance of the Regulatory Letter,
Alcon took several actions. It unsuccessfully attempted
to ascertain the basis for this belated attempt by the
agency to subject WANS to ‘‘new drug”’ status, in-
cluding the basis for its allegation of the existence of
‘‘significant new information.’’ It provided the agency
with data and information supporting the ‘‘old drug’’
status of WANS. It arranged for a meeting with FDA,
during which it pointed out certain inaccuracies and
distortions in the factual allegations contained in the
Regulatory Letter, including the fact that neither the
transcripts of the Advisory Committee meetings nor the
underlying drug experience reports supported the allega-
tion of ‘‘fatal reactions.’’ It is significant that at the
meeting FDA was unable to provide any explanation as
to the basis for the ‘‘fatal reactions’’ allegation except
for a flippant statement by an FDA official that the
reference was ‘‘boilerplate.’’ Following the meeting and
in light of certain general concerns expressed during the
Advisory Committee meetings as to the use of antiemetic
therapy in certain children, Alcon notified the agency
that it was revising its labeling for WANS to include ad-
ditional precautionary information.
6
The FDA agreed to have its medical officer review
these data and information, as well as the revised label-
ing, prior to irrevocably committing the agency to in-
Stituting regulatory action. However, without providing
Alcon an opportunity to challenge administratively the
agency’s findings or conclusions, the agency summarily
rejected the information submitted by Alcon and
reiterated in a letter dated August 4, 1978 that in the
absence of ‘‘voluntary market withdrawal’’ it was
prepared to institute enforcement action.
Despite its inability to document or substantiate the
existence of any ‘“‘significant new information’’ and
therefore in contravention of its own CPG, FDA in-
stituted a massive, ex parte seizure of WANS on
September 21, 1978, alleging that WANS is a ‘‘new
drug.’’ On the basis of its position that WANS is not an
unsafe drug or a ‘‘new drug’’ and that enforcement ac-
tion was improper under the CPG, Alcon continued to
manufacture and market the drug subsequent to the
seizure. This resulted in FDA’s bringing a second action
against WANS on November 28, 1978 in which it sought
to enjoin further shipments of WANS in interstate com-
merce. FDA sought a temporary restraining order, but
by Order dated November 29, 1978, the TRO was denied
by the District Court. The two pending cases were also
consolidated by this Order.
Alcon thereafter conducted extensive discovery of
the FDA and its witnesses,‘ thereby establishing the
absence of ‘‘significant new information’’ within the
meaning of the CPG. Indeed, discovery established that
* These witnesses were the same individuals whose statements
FDA initially relied upon as the basis for its allegation of untoward
effects.
-
the information cited in the Regulatory Letter was inac-
curate and distorted as it related to the Neurological
Drugs Advisory Committee’s recommendations and was
misleading insofar as it indicated any causal relationship
between the administration of pyrilamine/barbiturate
combination drugs and the purported untoward effects.°
In light of these discoveries, Alcon requested on
March 21, 1979 that the District Court remand the pend-
ing actions to the primary jurisdiction of FDA for a
determination of the ‘‘new drug’’ status of WANS. The
Motion to Remand was premised in part upon the
absence of any ‘“‘significant new information’’ which
would require a judicial decision of the ‘‘new drug’’
issues without the benefit of a formal administrative
record or which would justify initiating enforcement ac-
tion against WANS in contravention of the CPG. The
Motion to Remand requested the District Court, in the
exercise of its sound discretion and in recognition of the
25 year safe marketing history of WANS and the com-
plex scientific issues involved, to ‘‘stay its hand’’ and re-
mand the actions to the primary jurisdiction of FDA.
See CIBA Corp. v. Weinberger, 412 U.S. 640, 644
(1973).
While the Motion to Remand was pending, the
FDA, with no additional information (let alone the re-
quisite ‘‘significant new information’’), instituted a sec-
ond massive, ex parte seizure action against WANS on
January 28, 1980. On February 27, 1980, the District
* Discovery established that each of these purported untoward
effects could scientifically and reasonably be explained by
independent factors such as excessive doses, dehydration, natural
progression of the disease state, and concurrent medication. The
District Cour so held in its Order of April 29, 1980 (App. E, infra,
34a-36a).
8
Court, after reviewing the extensive documents before it
(including the depositions of FDA’s expert witnesses and
the Advisory Committee transcripts), issued in the exer-
cise of its sound discretion an Order which
(1) consolidated the January 28, 1980 seizure action
with the prior consolidated seizure and injunction
actions;
(2) granted Alcon’s motion of March 21, 1979 and
remanded the actions to the FDA with instructions
to hold, in conformity with the CPG, a hearing pur-
suant to 5 U.S.C. §554 on the issue of whether
WANS is a ‘“‘new drug’’;
(3) instructed FDA to defer regulatory action a-
gainst the WANS preparations, or against the
named defendants, based upon a ‘‘new drug”’
charge until FDA holds the administrative hearing
referred to in paragraph (2) and makes an ad-
ministrative determination of the ‘‘new drug’’ status
of WANS;
(4) held the two seizures to be without effect; and,
significantly
(5) specifically retained jurisdiction over whether
new, .erifiable, and genuinely significant informa-
tion comes to light which would justify enforcement
action against WANS out of the sequence provided
in the CPG.
App. C, infra, 25a-26a. On April 9, 1980 the District
Court issued its formal Opinion and Order (App. D, in-
fra, 27a-33a) and on April 29, 1980 it denied the FDA’s
request for a stay pending appeal (App. E, infra,
34a-36a). In the last Order, the District Court reiterated
that it was retaining jurisdiction over the entire matter
by ordering that one box each of WANS No. 1, WANS
No. 2, and WANS Children from each of the seizures be
retained under seal pending a final determination of the
“‘new drug”’ status of WANS.
Y
The FDA filed separate appeals from the Orders of
February 27 and April 9, 1980. Alcon sought summary
dismissal of the appeais, asserting that the remand
Orders were non-final and therefore not appealable
under 28 U.S.C. §1291, and in the alternative that the
Orders merely abated the actions and therefore were
non-appealable under 28 U.S.C. §2105.
On June 23, 1980, the Court of Appeals issued an
order deferring action on Alcon’s motions for suminary
dismissal unt!! consideration of the merits. On the same
date, the Court of Appeals granted the FDA a stay
pending appeal with respect to the District Court’s order
‘“‘enjoining’’ future seizures and ordering the return of
quantities of the drug already seized.
On October 6, 1980, four days before oral argument
in the Court of Appeals and over three months after the
District Court’s order deferring regulatory action had
been stayed, the FDA instituted a third, massive ex parte
seizure of WANS. Alcon moved immediately to dismiss
this third seizure action on the ground that it violated
the ‘‘multiple seizure’ provisions of the FFDCA. As an
alternate ground for dismissal, Alcon argued that under
the circumstances of the ongoing litigation, the failure to
obtain judicial scrutiny prior to the seizure was an un-
constitutional denial of due process of law. Citing the
Court of Appeals’ opinions as making judiciai scrutiny
meaningless, the District Court denied the motion to
dismiss in an Order entered March 18, 1981. United
States v. Articles of Drug...WANS, No. 80-2112
(D.P.R. Mar. 18, 1961).° Although this Order is not
* According to Judge Perez-Gimenez, judicia! scrutiny would
result in a meaningless exercise for the Court. The Court would
not have jurisdiction to prohibit the institution of seizure under
the Act even if the Court in a pre-seizure ‘‘review’’ were to
find that the action might involve an abuse of discretion or was
not supported by the statute. A court properly should decline
to reach such an illogical result.
10
presently before this Court, the Order emphasizes the
importance of this Court’s review of the issues presented
by this petition.
On the merits of FDA’s appeal, the Court of Ap-
peals rejected all of Alcon’s arguments and vacated the
District Court’s Orders. Its opinion of February 24, 1981
held, inter alia:
(1) that the District Court’s direction to FDA to
defer regulatory action constituted an injunction ap-
pealable under 28 U.S.C. §1292(a)(1) and that en-
joining regulatory action under the FFDCA violates
this Court’s ruling in Ewing v. Mytinger &
Casselberry, Inc., 339 U.S. 594 (1950) (App. A, in-
fra, Ta-9a);
(2) that the District Court’s dissolution of the two
seizures was appealable as a ‘‘collateral order’’
(Cohen v. Beneficial Industrial Loan Corp., 337
U.S. 541 (1949)) and that the District Court lacked
authority to dissolve the seizures prior to considera-
tion of the merits of the seizure proceedings (App.
A, infra, 10a-12a);
(3) that the Order remanding to the primary
jurisdiction of the FDA was an_appealable
‘collateral order’’ and that the District Court ex-
ceeded its authority by issuing such an order in this
enforcement proceeding under the FFDCA (App. A,
infra, 12a-23a);
(4) that it would decline to apply 21 U.S.C. §2105
(which precludes federal appellate review of orders
in abatement) to preclude its jurisdiction because,
the Court reasoned, Secticn 2105 is little used and
‘“‘has never been interpreted as a significant limita-
tion on federal appellate jurisdiction. . .’’ (App. A,
infra, 15a n.2).
REASONS FOR GRANTING THE PETITION
1. The Decision Below Conflicts With The Decisions Of
This Court Which State That A Court Can Remand The
‘*‘New Drug’’ Issues In An Enforcement Proceeding To
The Primary Jurisdiction Of The Food And Drug Ad-
ministration
The Court of Appeals ruled that in the context of a
‘‘new drug’’ enforcement proceeding the District Court’s
Orders remanding the issue of WANS’ ‘‘new drug’’
status to FDA’s primary jurisdiction were in error. App.
A, infra, 12a-23a. Citing its own decision in JCC v. B &
T Transportation Co.,’ 613 F.2d 1182, 1187 (lst Cir.
1980), the Court of Appeals held that such a remand
‘*makes little sense’’ in an enforcement proceeding where
the enforcing agency’s views are already known. This
holding ignores the fact that FDA’s views were constant-
ly shifting,’ as well as the findings of the District Court
that FDA’s enforcement activities were predicated upon
‘contradictory’? and ‘“‘insufficient’’ information (App.
E, infra, 35a n.1).
Apparently in deference to this Court’s decisions in
CIBA and Weinberger v. Bentex Pharmaceuticals, Inc.,
’The B & T Transportation case involved issues concerning the
Interstate Commerce Commission, not the FDA. In B & T, the
Court of Appeals (in dictum) indicated that a remand in an ICC
enforcement proceeding would be futile, explaining that a remand
would be inappropriate because the issues to be remanded did not
fall within the primary jurisdiction of the ICC. 613 F.2d at 1187
n.8. That is clearly distinguishable from the situation here where, as
this Court has held, the ‘‘new drug’’ issues are within the FDA’s
primary jurisdiction.
* Thus, for example, FDA abandoned its reliance upon the CPG
and the ‘‘significant new information’’ exception to the CPG when
discovery made it clear that under the CPG the pending
enforcement actions against WANS could not be justified.
}2
—
412 U.S. 645 (1973), the Court of Appeals attempted to
draw a distinction between remands affecting only one
drug and one company, which it considered inap-
propriate, and remands with potentially broader effect
involving drugs manufactured by many different com-
panies. App. A, infra, 22a. Not only does this distinc-
tion lack legal justification but, as applied to the facts of
this case, does not support the Court’s ruling. WANS is
but one representative of a class of combination antihis-
tamine/barbiturate antiemetics whose status as ‘‘new
drugs’’ is questioned by this proceeding. Indeed, the
Regulatory Letter described the action against WANS as
a ‘‘class action’’ involving all antihistamine/barbiturate
antiemetics and was but one of a number sent in 1978 to
the manufacturers of such drugs. These facts are cor-
roborated by an FDA affidavit (which was before the
Court of Appeals) in which an FDA compliance officer
cites as reasons for expediting the trial in the District
Court the agency’s fears that three firms were about to
resume marketing of WANS-type preparations. In any
event, the distinction between remands involving one
drug and a class of drugs is a spurious one which has no
precedent other than the one here under review.
More importantly, the Court’s ruling misinterprets
and clearly conflicts with the principles announced by
this Court in several ‘‘new drug’’ cases. In CIBA Corp.
v. Weinberger, 412 U.S. 640, 644 (1973), this Court
stated:
Cases may arise where there has been no formal ad-
ministrative determination of the ‘‘new drug’’ issue,
it being first tendered to a district court. Even then,
however, the district court might well stay its hand,
awaiting an appropriate administrative determina-
tion of the threshold question.
13
On the precise issue of whether a remand is proper in an
enforcement proceeding, this Court spoke with equal
clarity in a companion case to CIBA:
Even where no such administrative determination
has been made and the issue arises in a district court
in enforcement proceedings, it would be com-
monplace for the court to await an appropriate ad-
ministrative declaration before it acted.
Weinberger v. Bentex Pharmaceuticals, Inc., 412 U.S.
645, 652 (1973) (emphasis added).
The rejection by the Court of Appeals of this
Court’s endorsement of remanding ‘‘new drug’’ issues to
FDA’s primary jurisdiction also conflicts with the opin-
ions of several other courts. In JMS Ltd. v. Califano,
453 F. Supp. 157 (C.D. Cal. 1977), the drug manufac-
turer had received a Regulatory Letter (analogous to the
one here) alleging that its drug was a ‘‘new drug’’ and
threatening enforcement action. The manufacturer sued
for a declaratory judgment to the contrary.’ The Court
reviewed Supreme Court case law on FDA’s primary
jurisdiction and the appropriate circumstances in which
to invoke such jurisdiction, and dismissed the action on
*In IMS, the FDA had announced in its Regulatory Letter that
in the absence of ‘‘voluntary’’ market withdrawal of the drug at
issue it was prepared to utilize its enforcement powers, including
seizure and injunction actions. Based upon this threat of immediate
enforcement action, IMS sought declaratory relief in federal district
court. To distinguish JMS on the ground that it involved a
declaratory action rather than an enforcement action would be to
draw a spurious distinction in favor of the drug company which
seeks declaratory relief rather than the company which tries,
although unsuccessfully, to convince the agency of the
inappropriateness of the enforcement action.
14
the ground that the ‘‘new drug’’ issue should first be
resolved in an administrative setting. The Court stated:
The suggestion that the agency determination must
in some way reflect formal, in the sense of properl
presented and considered, judgment accords wit
the rationale underlying the entire series of opinions.
Id. at 159. The Court then ruled:
It seems clear that the type of informal letter issued
by the FDA, apparently without having first con-
ducted any tests, does not constitute the kind of for-
mal or final agency action the Supreme Court had
in mind.
Id. at 160.
The Bentex and CIJBA rulings were also the basis
for the decision in Rutherford v. United States, 542 F.2d
1137 (10th Cir. 1976). In Rutherford, the Court of Ap-
peals upheld the District Court’s preliminary injunction
prohibiting FDA from interfering with the interstate
shipment of Laetrile and remanded to the District Court
with instructions to remand to the agency for an ad-
ministrative determination of the ‘‘new drug’’ issues. In
that suit, FDA had contended it had already determined
that Laetrile was a ‘‘new drug.’’ The Tenth Circuit
reviewed the agency’s purported ‘‘new drug’’ determina-
tion and stated:
The FDA has done this without citing any facts
whatsoever, merely a conclusion... .
* * *
We are unable ... to see how the FDA can
escape the obligation of producing an administrative
record to support its determination of the first and
more fundamental issue that Laetrile is a new drug,
for it is not a new drug merely because they say it
oS
15
is. Moreover, such a conclusory ruling precludes ef-
fective review under 5 U.S.C. Section 706(2)....
Id. at 1143 (emphasis in original). In the absence of a
reviewable administrative record on the ‘‘new drug’’
issue, the proper course of action was clear to the Court:
[T]he appropriate procedure for the district court is
to remand the case back to the FDA for proceedings
adequate to develop a record supportive of the
agency’s determination; the proceedings should give
Laetrile proponents an opportunity to express their
views. This is a result which is also supported by the
Supreme Court decision in Weinberger v. Bentex
Pharmaceuticals. .. .
Id. at 1143-1144.
The Court of Appeal’s conclusion that there is no
precedent to support the remand authority is thus plainly
incorrect. Indeed, in so arguing it has turned the deci-
sions on their heads. In fact, no court has ever held that
a district court lacks such authority and many, including
this Court, have affirmed that authority, including the
authority to remand in an enforcement proceeding.
Nor does the Court of Appeals’ observation that
remands are rarely ordered provide any basis for revers-
ing the District Court’s orders. Given the clear directives
of this Court, it was surely within the District Court’s
discretion to order a remand under the facts of this par-
ticular case.
Perhaps in recognition that its ‘‘no one ever does
this’? rationale would not stand up to scrutiny in light of
Bentex and CIBA, the Court of Appeals sought to
bolster its conclusion with two additional arguments.
First, it stated that a remand ‘‘imposes an administrative
burden for which the [FFDCA] makes no provision.’’
App. A, infra, 23a. In so stating, it overlooked the
16
FDA’s own regulations'® and established administrative
precedents'' which clearly contemplate referral by courts
and determination by FDA of the ‘‘new drug’’ issues.
Second, while paying lip service to this Court’s
views on the advantages of seeking FDA’s expert judg-
ment on ‘‘new drug”’ issues, the Court below found that
such remands are burdensome and_ time-consuming.
App. A, infra, 21a-23a. This Court’s own words, cited
by the District Court in its remand order (App. D, infra,
30a-31la), dispose of those arguments:
We conclude that the District Court’s referral of
the ‘‘new drug’’ and ‘‘grandfather’’ issues to FDA
was appropriate, as these are the kinds of issues
peculiarly suited to initial determination by the
FDA. As the District Court said: ‘‘Evaluation of
conflicting reports as to the reputation of drugs
among experts in the field is not a matter well left
to a court without chemical or _ medical
background.’’ The determination whether a drug is
generally recognized as safe and effective within the
meaning of § 201(p)(1) necessarily implicates com-
plex chemical and pharmacological considerations.
Threshold questions within the peculiar expertise of
an administrative agency are appropriately routed to
the agency, while the court stays its hand.
'° 21 CFR §10.60 (procedures to handle a referral by a court).
See also 21 CFR §314.200(e) in which ‘‘new drug’’ and
‘“‘grandfather’’ issues are specifically delineated as issues to be
addressed in a new drug approval or withdrawal proceeding.
'' See, e.g., 41 Fed. Reg. 14405 (1976), ‘‘Drug Products
Containing Papaverine or Ethaverine, and Similar or Related
Drugs: Request for Data on Safety, Effectiveness, and Legal
Status.’ In that case, the agency called for any data available to
support the “‘old drug’’ or ‘‘grandfather’’ status of these drugs. If
the data submitted failed to show that the product is safe and
effective, the April 5 Notice contemplated the publication of an
additional notice providing an opportunity for a hearing.
17
Bentex, supra, 412 U.S. at 653-654 (emphasis added).
Because the Court of Appeals has _ seriously
misconstrued the implications of prior decisons of this
Court, it is respectfully suggested that the Court will
wish to grant this petition to clarify the meaning of its
prior decisions. See, e.g., Securities & Exch. Com’n v.
United Ben. L. Ins. Co., 387 U.S. 202, 207 (1967). In-
deed, Alcon submits that the Court of Appeals’ unique
and aberrant views on the issue of remand in an FFDCA
enforcement proceeding call for swift and sure correction
by this Court before the decision can be used as prece-
dent to stifle an important, increasingly-used tool for the
control by District Courts of the manner and time in
which cases on their dockets should be handled.'’
2. The Decision Below Conflicts With The Decisions Of
This Court And Of Another Court Of Appeals Which
Indicate That A Court Can Enjoin Further Enforcement
Action By The Food And Drug Administration Pending
A Remand To That Agency For Determination Of The
‘‘New Drug’’ Issues
In the Court below, Alcon argued that the District
Court’s order that FDA defer regulatory action pending
the remand was non-final and merely an exercise of that
Court’s discretion to control the case before it. To
establish appellate jurisdiction, the FDA argued (and the
Court of Appeals agreed) that the order to defer
regulatory action was an injunction and so was ap-
pealable under 28 U.S.C. §1292(a)(1). App. A, infra,
'2 As will be noted in the discussion of Question 3, infra, Alcon
seeks review and reversal under 28 U.S.C. §2105 of the appellate
court’s exercise of jurisdiction over all aspects of the District
Court’s Orders. A finding by this Court that the Court of Appeals
lacked appellate jurisdiction over the Orders would, of course,
avoid the necessity of reviewing the merits of the remand issue.
18
7a-8a. The Court then found the ‘‘injunction’’ improper
under Ewing v. Mytinger & Casselberry, Inc., 339 U.S.
594 (1950), reading that decision as precluding a district
court from enjoining multiple seizure actions under the
FFDCA. Moreover, going beyond Ewing (yet citing it as
authority), the Court of Appeals held that Ewing
‘*precludes judicial interference with the FDA’s decision
to institute enforcement actions, whatever the precise
context.’ App. A, infra, 8a (emphasis added). Alcon
respectfully submits that the Court below has given an
overbroad reading to an older, non-controlling case.
Moreover, its decision conflicts with newer decisions of
this Court and another Court of Appeals which have
squarely sanctioned injunctions against regulatory action
pending a remand of the ‘‘new drug’’ issues to FDA’s
primary jurisdiction.
It is submitted that £ ving is not controlling in the
circumstances of this case. Ewing did not, contrary to
the Court of Appeals’ interpretation of it, create an ab-
solute prohibition against enjoining the FDA from in-
stituting multiple seizures under any and all cir-
cumstances. Rather, Ewing held that where the operative
statute provides a specific standard for initiating multiple
seizures and where the agency has made the requisite
findings pursuant to that standard,'’ a court does not
have jurisdiction to halt ‘‘a// multiple seizures.’’ This is
to be compared with the instant case where (1) addi-
tional seizures based upon the alleged ‘‘new drug’’ status
of WANS would not be controlled by a statutory stan-
dard or by a requirement for a specific administrative
'* The failure of the agency to make these findings would have
been sufficient basis under Ewing for a court to enjoin multiple
seizures.
1Y
finding,'* (2) the District Court’s Orders do not purport
to halt a// multiple seizures but rather, at most, only pur-
port to enjoin multiple seizures based upon a ‘‘new
drug’’ charge,'’ and (3) the seizure of WANS, whether
single or multiple, was contrary to the agency’s binding
advisory opinion/guideline (the CPG) which, under its
specific terms, precluded enforcement action against
WANS based upon a ‘‘new drug’’ charge pending the
completion of enforcement actions against those drugs
identified in the CPG as being subject to a higher en-
forcement priority.'® These factors, both individually and
collectively, clearly distinguish this case from Ewing."’
'* That portion of 21 U.S.C. §334(a) which was at issue in Ewing
governs only multiple seizures based upon a misbranding charge
and not multiple seizures based upon a ‘‘new drug’”’ charge. In the
case of a ‘‘new drug’’ charge, unlike a misbranding charge, 21
U.S.C. §334 does not establish a standard defining when multiple
seizures are appropriate, nor does it require a probable cause
finding by the Secretary of conformity with the standard prior to
the initiation of multiple seizures. See App. F, infra, 37a.
'S Thus, if at any time the FDA has probable cause to believe
that the WANS preparations are ‘‘unsafe’’ or ‘‘dangerous to
health,’’ the District Court’s ‘‘injunction’’ against regulatory action
based upon the alleged ‘‘new drug’’ status of WANS would not
prevent the agency from relying upon the misbranding and/or
adulteration provisions of the FFDCA as the basis for instituting
multiple seizures. See 21 U.S.C. §§334(a)(1)(B) [App. F, infra,
37a-38a], 351(a)(1)(B) [App. F, infra, 4la], and 352(j) [App. F,
infra, 42a].
‘© The Court of Appeals found the CPG inapplicable to WANS
(App. A, infra, 17a-20a), a proposition Alcon vigorously disputes.
Because of the importance of the CPG ruling, it should be
considered as part of a review on the merits if the petition is
granted.
' Nor is the language in Ewing that ‘‘consolidation ... is the
relief afforded the distributors of the articles’? of any comfort to
Alcon, as the Court of Appeals believed (App. A, infra, 9a). First,
there is a significant question whether consolidation is available
20
It is submitted that, contrary to the Court of Ap-
peals’ rulings, neither Congress in enacting the FFDCA
nor the Supreme Court in Ewing intended to prevent a
court from enjoining multiple seizures instituted without
factual or legal justification. For example, in Victrylite
Candle Co. v. Brannan, 201 F.2d 206 (D.C. Cir. 1952),
the Court of Appeals cited Ewing for the proposition
that multiple seizures ‘‘are not in and of themselves a
deprivation of due process’’ but nevertheless specifically
noted that ‘‘multiple seizures may be so arbitrarily and
destructively engaged in as to amount to a denial of due
process, in which event equity may intervene by its in-
junctive process.’’ Jd. at 207. See also National Remedy
Co. v. Hyde, 50 F.2d 1066 (D.C. Cir. 1931).
Moreover, while Ewing was not controlling below, it
is submitted that this Court’s Bentex ruling was, for it
squarely upheld an injunction against regulatory action
pending a remand of the ‘‘new drug’’ issues. In that
case, the District Court remanded the ‘‘new drug’’ issue
to the primary jurisdiction of the FDA for determina-
tion, simultaneously enjoining ‘‘any action against the
[drug company] and their products until [they] had been
accorded a hearing before the Secretary on the issue of
the qualifications of these drugs for protection under the
‘grandfather clause’.’’ See Bentex Pharmaceuticals, Inc.
v. Richardson, 463 F.2d 363, 369 (4th Cir. 1975). The
Court of Appeals reversed, ruling that the District Court
lacked authority to remand the ‘‘new drug’’ (‘‘grand-
father’’) issue. Jd. at 371-372. However, the Supreme
Court ultimately ruled (as indicated in the discussion of
under the FFDCA in ‘‘new drug’’ (as opposed to misbranding and
adulteration) proceedings. 21 U.S.C. §334(b), App. F, infra, 38a.
Second, there already has been a consolidation of the first two
WANS seizures and this afforded Alcon no relief whatsoever as the
agency thereafter instituted a third seizure.
21
se
Question 1, supra) that the remand power does exist. It
therefore reversed the Court of Appeals’ decision,
thereby reinstating the District Court’s injunction against
regulatory action pending the remand to FDA.
Weinberger v. Bentex Pharmaceuticals, supra, 412 U.S.
at 654 (per Douglas, J., the author of the Ewing
decision).
Similarly, in Rutherford v. United States, supra, the
Tenth Circuit was called upon to review the District
Court’s remand of the ‘‘new drug’’ issues to FDA and
its injunction against FDA’s interference with the ship-
ment of the drug in issue pending the FDA’s develop-
ment of an administrative record during the remand.
The Court of Appeals affirmed both the remand and in-
junction aspects of the lower court’s order. 542 F.2d at
1144. It specifically cited the injunction provisions of the
Administrative Procedure Act, 5 U.S.C. §705,'* as
authority for continuing the injunction in effect pending
the remand.'’
The Bentex and Rutherford decision undoubtedly
were predicated upon the realization that, in the absence
of an injunction, FDA’s unbridled discretion to initiate
multiple seizures based upon a ‘‘new drug’”’ charge could
be used to moot the remand and deny the claimant his
day in court. Indeed, Alcon’s (and the District Court’s)
fears that, unless restrained, the FDA would continue
conducting crippling, ex parte seizures of WANS without
awaiting a judicial or administrative resolution of the
8 66
{[T]o the extent necessary to prevent irreparable injury, the
reviewing court . . . may issue all necessary and appropriate process
to postpone the effective date of an agency action or to presei e
-
Status or rights pending conclusion of the review proceedings.”’
'* See also Upjohn Co. vy. Finch, 303 F. Supp. 241 (W.D. Mich.
1969).
22
‘“‘new drug’’ issues seemed to have been borne out by the
FDA’s third seizure of WANS four days prior to oral
argument in the Court of Appeals. It is reflective of
FDA’s motives underlying this third seizure that,
although the Court of Appeals stayed that portion of the
Order ‘‘enjoining’’ further new drug seizures on June 23,
1980, FDA did not institute the third seizure action until
October 6, 1980. It is submitted that FDA’s motive
underlying this latest seizure was a tactical decision to in-
fluence the outcome of the proceeding in the Court of
Appeals and not one predicated upon any concern about
the safety of WANS. It must be remembered that the
District Court found after reviewing the transcripts of
the depositions of the FDA witnesses, as well as other
discovery documents, that the FDA’s earlier allegations
of potential safety problems (allegations which were
predicated upon earlier statements of the agency’s
witnesses) were ‘‘contradictory’’ and ‘‘insufficient’’ to
initiate regulatory action under the CPG, a finding
which was not challenged by the FDA or the Court of
Appeals.
The decision of the Court of Appeals here refusing
to uphold the ‘“‘injunction’’ pending the remand thus
clearly conflicts with the decisions of this Court and of
the Tenth Circuit. Additionally, these latter decisions
reflect the importance of this Court’s considering the re-
mand and injunction issues in tandem for, if the remand
order is to be meaningful, a district court must have the
discretion to prevent FDA from conducting, as it has
here, a destructive series of multiple seizures, thereby
unilaterally obtaining a de facto injunction against ship-
ment of the drug and depriving the drug company of its
day in court.
It is submitted, therefore, that Ewing must be read
in light of the subsequent cases which, unlike Ewing,
23
dealt specifically with the remand and injunction issues.
Indeed, unless Ewing is read more narrowly than the
Court below reads it, this will mean that the FDA will
have absolute discretion to put a company out of
business by conducting multiple seizures even where, as
here, a district court has found after reviewing the
record that the agency’s alleged basis for initiating
regulatory action was not supported by the facts. In this
respect, it is significant that, unlike the factual settings
presented in the cases relied upon by the FDA and the
Court of Appeals, Alcon did not seek to avoid the initia-
tion of regulatory action by bringing an independent ac-
tion to enjoin seizures. Rather, it was only after FDA
had initiated enforcement action and discovery had
shown that these actions were ill-founded that it sought,
and the District Court granted, the ‘‘remand/injunction’’
Orders.
Because of the importance of this question in terms
of due process for drug manufacturers, and in order to
define more precisely what restraints do exist on the ex-
ercise of the FDA’s discretion under the FFDCA, it is
respectfully requested that the Court grant the petition.
3. The Decision Below Violates 28 U.S.C. §2105 and
Presents Important Questions Of First Impression Con-
cerning Federal Appellate Jurisdiction Over Orders In
Abatement
Aicon argued that the Court of Appeals lacked
jurisdiction to review any aspect of the District Court’s
Orders since they merely abated the actions within the
meaning of 28 U.S.C. §2105.*° That statute provides:
There shall be no reversal in the Supreme Court or
a court of appeals for error in ruling upon matters
in abatement which do not involve jurisdiction.
** Alcon also argued that the Court of Appeals lacked juridiction
in that the orders were not final decisions within the meaning of 28
24
This statute is a significant (if seldom cited) limitation on
federal appellate jurisdiction and should be read in con-
junction with the ‘‘final order’’ rule (28 U.S.C. §1291)
as expressing a judgment by Congress that the appellate
dockets should not be inundated by appeals of patently
non-final orders. In a brief and curious footnote,
however, the Court of Appeals dismissed Alcon’s Sec-
tion 2105 argument without really addressing it, stating
that it would not sustain Alcon’s objections to jurisdic-
tion because 2105 ‘‘has never been interpreted as a
significant limitation on federal appellate jurisdiction
... (citing a treatise which states that ‘‘the most im-
portant feature of § 2105 is certainly its disuse’’?'). In
thus trampling upon a significant, if little used, statute
governing federal appellate jurisdiction, the Court of
Appeals erred and presented this Court with an oppor-
tunity to pass on an important question of first impres-
sion. See, e.g., American Federation of Musicians v.
Wittstein, 379 U.S. 171, 175 (1964).
U.S.C. §1291 nor appealable ‘‘collateral orders’’ within the
meaning of Cohen v. Beneficial Industrial Loan Corp., 337 U.S.
541 (1949). An analysis of the principles set forth in Cohen, as
interpreted by more recent decisions of this Court (especially
Firestone Tire & Rubber Co. v. Risjord, 101 S.Ct. 669 (1981)),
establishes that the Orders were not collateral orders and that the
Court of Appeals’ finding to this effect conflicts with a long line of
decisions of this Court concerning the definition and applicability
of the ‘‘collateral order’’ doctrine. Accordingly, in the event this
Court grants the petition it should also consider whether the Court
of Appeals committed reversible error in holding that under the
collateral order exception to 28 U.S.C. §1291 it had jurisdiction to
review the District Court’s Orders.
7" 15 Wright, Miller, & Cooper, FEDERAL PRACTICE AND
PROCEDURE §3903, at 414 (1976).
25
—
The remand Orders clearly effected an abatement of
the actions before the District Court.?? ‘‘Abatement,’’ as
several decisions have noted in reviewing Section 2105, is
the overthrow of an action which defeats the action for
the present, but does not debar the plaintiff from com-
mencing it in a better way. Aetna State Bank v.
Altheimer, 430 F.2d 750, 753-754 (7th Cir. 1970); Bowles
v. Wilke, 175 F.2d 35, 37 (7th Cir. 1949). Abatement in
equity (such as obtains here since FDA sought an injunc-
tion) is an interruption or suspension of a suit which is
brought about by the defendant setting up facts in abate-
ment. 1 C.J.S. Abatement and Revival §1, at 27 (1936).
Equitable abatement is analogous to a plea in suspension
in which the defendant shows some ground for not pro-
ceeding with the suit at the present time and prays that
the proceeding be stayed until the ground is removed. 1
C.J.S. Abatement and Revival §7, at 36. See 1 AM. JuR.
2d Abatement, Survival, and Revival §1, at 42 (1962).
Alcon’s Motion to Remand meets all of these criteria.
Reviewing Section 2105, the Court of Appeals
found that the District Court’s Orders involved jurisdic-
tion, citing Aetna, supra at 653, and therefore came
within an exception to Section 2105. While there is some
confusing dictum in Aetna suggesting that Section 2105
may be inapplicable when another federal statute
specifically grants jurisdiction, that language is not con-
trolling here. The FFDCA provides no specific appellate
jurisdiction over a ‘‘new drug’’ remand order and so is
distinguishable from the Aetna facts. Moreover, Aetna
involved abstention by a federal court in a matter involv-
ing mixed federal/state issues, in which the federal court
2? The Court of Appeals did not even address this basic issue,
instead ‘‘Passing by the question whether this action is in
abatement. ...’’ App. A, infra, 15a n.2.
26
dismissed the federal action entirely. Here, the District
Court specifically retained jurisdiction over the whole
matter pending the remand to FDA’s primary jurisdic-
tion. As Professors Wright, Miller, and Cooper state in
analyzing Section 2105, a remand to an agency’s primary
jurisdiction is a typical example of a ‘‘matter[ ] in abate-
ment which dofes] not involve jurisdiction.’’ 15 Wright,
Miller, & Cooper, FEDERAL PRACTICE AND PROCEDURE
§3903, at 414.
The Court of Appeals also argued somewhat lamely
that ‘‘our disposition of the case is not, technically, a
‘reversal’. ..’” as that term is used in Section 2105.
However, it is difficult, if not impossible, to identify any
proposition of law or fact proffered by Alcon or relied
upon by the District Court which the Court of Appeals
did not reverse.
In short, the Court of Appeals’ ruling on Section
2105 constituted manifest error. In refusing to apply the
language of that statute to a situation so obviously
within the reach of the statute, the Ceurt so far departed
from the accepted and usual course of judicial pro-
ceedings as to call for the immediate exercise of this
Court’s power of supervision. That a statute is rarely in-
voked in no way detracts from the fact of its existence
or from the duty of a court to enforce it. That a statute
is even less frequently relied upon to limit federal ap-
pellate jurisdiction should in no way deter courts with
crowded dockets from using it in appropriate cir-
cumstances, thereby effectuating the Congressional pur-
pose of limiting federal appellate jurisdiction to truly
final decisions of the District Courts.”?
** Because of the manifest error of the Court of Appeals in
refusing to decline jurisidiction under 28 U.S.C. §2105, this Court
may wish to consider summary reversal of the Court of Appeals’
opinion and reinstatement of the District Court’s Orders.
27
CONCLUSION
For these reasons, a writ of certiorari should issue
to review the opinion and judgment of the United States
Court of Appeals for the First Circuit. The Court may
wish to consider summary reversal on the basis of 28
U.S.C. §21085.
Respectfully submitted,
THOMAS O. HENTELEFF
GLENN E. DAVIS
Counsel for Petitioners
Of Counsel:
MANUEL A. GUZMAN
PETER R. MATHERS
March 23, 1981
APPENDIX
la
APPENDIX A
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
Nos. 80-1188, 1357
(Decided February 24, 1981)
UNITED STATES OF AMERICA,
Vv.
ALCON LABORATORIES, ETC., ef al.,
Before CoFFIN, Chief Judge,
PELL* and CAMPBELL, Circuit Judges.
OPINION
CAMPBELL, Circuit Judge. The United States appeals from
orders of the District Court for the District of Puerto Rico in
two seizure actions and a suit for injunctive relief instituted
by the Food and Drug Administration (FDA) against Alcon
Laboratories, Inc. (Alcon) and one of its products pursuant to
the Federal Food, Drug, and Cosmetic Act, 21 U.S.C.
§§301-92 (1976).
Alcon manufactures and markets in suppository dosage a
prescription antiemetic drug called ‘‘WANS.”’ The drug con-
tains pyrilamine maleate (an antihistamine) and pentobarbital
sodium (a barbituate [sic]) and comes in three dosage
strengths, WANS No. 1, WANS No. 2 and WANS Children.
WANS has been used under medical supervision for approx-
*Of the Seventh Circuit, sitting by designation.
2a
imately 25 years, and did not become an object of FDA con-
cern until 1978. To understand what then transpired, it is first
useful to review parts of the Federal Food, Drug, and
Cosmetic Act.
Section 505 of the Act forbids the introduction into in-
terstate commerce of any ‘‘new drug’’ unless the FDA has ap-
proved a New Drug Application (NDA) for the product. 21
U.S.C. § 355. Section 201(p) defines a ‘‘new drug’’ as
**“(1) Any drug (except a new animal drug or an animal
feed bearing or containing a new animal drug) the com-
position of which is such that such drug is not generally
recognized, among experts qualified by scientific training
and experience to evaluate the safety and effectiveness of
drugs, as safe and effective for use under the conditions
prescribed, recommended, or suggested in the labeling
thereof, ... or
(2) Any drug (except a new animal drug or an animal
feed bearing or containing a new animal drug) the com-
position of which is such that such drug, as a result of in-
vestigations to determine its safety and effectiveness for
use under such conditions, has become so recognized, but
which has not, otherwise than in such investigations, been
used to a material extent or for a material time under
such conditions.’’
21 U.S.C. §321(p). Obtaining approval of an NDA requires’
the submission of extensive scientific data and can be slow
and expensive, see Note, New Drug Approval: Lannett, The
Drug Lag and the NDA System, 1! Rut.-Cam. L.J. 231-34;
248-53 (1980), but Congress imposed these burdens in fur-
therance of a compelling purpose: ‘‘to protect the public
against danger to human life arising from use of unsafe and
ineffective drugs by assuring that before any drug is marketed
it will have been carefully reviewed by FDA experts.’’ Premo
Pharmaceutical Laboratories, Inc. vy. United States, 629 F.2d
795, 802 (2d Cir. 1980).
3a
A product may be marketable without prior FDA ap-:
proval for any of three reasons. First, a drug is not a ‘‘new
drug’’ if ‘‘generally recognized, among experts qualified by
scientific training and experience to evaluate the safety and ef-
fectiveness of drugs, as safe and effective for use under the
conditions prescribed, recommended, or suggested in the
labeling thereof’’; if this ‘‘expert consensus is founded upon
‘substantial evidence’ ’’; and if the drug has ‘‘been used to a
material extent or for a material time under such conditions.”’
21 U.S.C. § 321(p); Weinberger v. Hynson, Westcott & Dun-
ning, Inc., 412 U.S. 609, 631-32 (1973); Premo Phar-
maceutical, supra, 629 F.2d at 801-02. Second, under a
‘“‘srandfather’’ clause inserted in the 1938 Act, drugs which
prior to June 25, 1938 (the effective date of the Act) were
‘subject to the Food and Drugs Act of June 30, i906’ and
have since undergone no change in composition, labelling or
recommendations for use are exempt from Section 505’s
premarketing approval requirements. 21 U.S.C. § 321(p)(1).
And third, another grandfather clause in the Act, added in
1962, relieves from premarketing approval any drug which
prior to October 10, 1962 (the effective date of the 1962
amendments) ‘‘was commercially used or sold in the United
States,’’ was generally recognized as safe by qualified experts,
was not covered by an effective new drug application and has
undergone no change in composition or labeling. Comment to
zi U.S.C. § 321.
Where the FDA believes that a drug is a ‘‘new drug’’ and
is being marketed without approval of an NDA, it is em-
powered to institute seizure and injunction actions in federal
district court to remedy the alleged violation of the Act. 21
U.S.C. §§ 332, 334. The agency may also seek criminal sanc-
tions. 21 U.S.C. § 333.
On March 17, 1978, the FDA sent Alcon a regulatory let-
ter informing it of a report received from the agency’s
Neurological Drugs Advisory Committee ‘‘that children aged
6 months to seven years who were treated for nausea and
vomiting with drugs containing pyrilamine maleate and pen-
4a
tobarbital, experienced severe and sometimes fatal reactions.”’
The Committee had concluded, the letter went on, ‘‘that there
is no evidence of safety and efficacy for drugs containing
pyrilamine maleate with or without a barbituate [sic] in the
treatment of nausea and vomiting.’’ Based on the Commit-
tee’s report, ‘‘and because [the FDA was] unaware of
substantial scientific evidence which demonstrates that a com-
bination of these ingredients is generally recognized as safe
and effective for the treatment of nausea and vomiting,’’ the
FDA advised Alcon that it considered Alcon’s marketing of
WANS to be in violation of the ‘‘new drug’’ provision of the
Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 355. The
letter stated that under FDA regulatory policy as formulated
in Compliance Policy Guide 7132c.08, see infra, WANS had
become subject to immediate regulatory action outside the
agency’s ordinary enforcement priorities ‘‘because of new in-
formation concerning the safety and efficacy of these drugs.”’
Alcon was told to reply within ten days, and was warned that
failure to discontinue marketing WANS would expose the
company to seizure and injunction actions.
Alcon responded on April 3, 1978. It claimed that WANS
was not a ‘‘new drug,’ objected to the FDA’s departure from
the ordinary sequence of its enforcement priorities on the
basis of an ‘‘unsubstantiated, conclusionary indictment of the
safety’’ of the active ingeedients in WANS, and requested that
it be allowed to ‘‘identify and review the data and informa-
tion upon which the Agency relies, and to make a formal sub-
mission to the Agency... .’’ The company also offered to
revise the labeling of WANS consistent with the findings of its
review. Subsequent to this letter, Alcon, on its own initiative,
sent the FDA proposed new labeling for WANS and informa-
tion supporting the safety and efficacy of the drug. Various
company officials met with agency officials on July 10 and
18, 1978 to discuss WANS.
The FDA reviewed the materials provided by Alcon and
in a letter of August 4, 1978 reaffirmed its position upon the
‘‘new drug’’ status of WANS: ‘the data submitted .. . con-
Sa
tains no adequate scientific data to support the safety and ef-
ficacy of the Wans products.’’ Though the proposed relabel-
ing was felt to be ‘‘an improvement,”’ it could not sibstitute
for ‘‘scientific evidence to establish that a fixed combination
of pyrilamine maleate and pentobarbital sodium is either safe
or effective for the treatment of nausea and vomiting.’’ The
letter made no reference to Compliance Policy Guide 7132c.08
or to the enforcement priority scheme delineated therein.
Alcon continued to manufacture WANS and on
September 21, 1978 the FDA instituted a seizure action in
federal district court alleging that the drug was a ‘‘new drug’’
being marketed in violation of Section 505 of the Act, 21
U.S.C. § 355. By court order, a large quantity of WANS sup-
positories (approximately 453,900) was seized. In its respon-
sive pleadings in the seizure action, Alcon admitted that no
approval of a new drug application was in effect for WANS
or was being sought. The company nevertheless denied that
WANS was being marketed in violation of section 505. Alcon
argued that WANS is not subject to the ‘‘new drug’’ re-
quirements of the Act because ‘“‘it is generally recognized as
safe for use under the conditions prescribed, recommended or
suggested in its labeling, and it is exempted from the ‘ef-
ficacy’ requirements of the Federal Food, Drug and Cosmetic
Act’’ by the 1962 grandfather clause discussed supra. In addi-
tion, Alcon contended that the FDA was acting in violation of
its pertinent Compliance Policy Guide.
Despite seizure of the suppositories, Alcon continued to
manufacture and distribute WANS, thus prompting the FDA,
on November 28, 1978, to institute a further action, this time
seeking a temporary restraining order, a preliminary injunc-
tion and a permanent injunction against continued marketing
of WANS without FDA approval. On the next day,
November 29, the district court denied the FDA’s request for
a temporary restraining order, and consolidated the injunctive
suit with the earlier seizure action. On December 19, 1978, the
district court gave the parties 90 days to complete discovery in
the consolidated proceeding and set a trial date of May 7,
1979.
6a
On March 21, 1979, however, Alcon moved the district
court to remand to the FDA,
‘‘with instructions to defer regulatory action against the
WANS preparations involved in this matter or against
defendants based upon the alleged ‘new drug’ status of
WANS until FDA makes an administrative determination
of the new drug status of WANS in conformity with the
enforcement priorities enunciated in FDA’s Compliance
Policy Guide 7132c.08 and the requirements of the Ad-
ministrative Procedure Act, or unless verifiable and gen-
uinely significant and new information surfaces which
questions the safety or efficacy of a WANS preparation
so as to justify taking regulatory action against such
preparation out of the sequence provided by the Agency’s
Compliance Policy Guide 7132c.08.”’
No further action was taken in the case until January 28,
1980. On that date the FDA instituted a second seizure
against WANS. Large quantities of the drug were again con-
fiscated. A month later, on February 27, 1980, the district
court consolidated the latest seizure action with the pending
actions, and ordered the entire case to be,
‘‘remanded to the Food and Drug Administration (FDA)
with instructions to defer regulatory action against the
WANS preparations involved in this matter or against
defendants based upon the alleged ‘new drug’ status of
WANS until FDA holds a hearing pursuant to 5 U.S.C.
§ 554 and thereafter makes an administrative determina-
tion of the new drug status of WANS in conformity with
the enforcement priorities enunciated in FDA’s Com-
pliance Policy Guide 7132c.08.
‘*Accordingly, it is FURTHER ORDERED
‘That prior seizures ordered by the Court are left
without effect.
‘‘However, jurisdiction will be retained whether new,
verifiable and genuinely significant information comes to
light which questions the safety or efficacy of a WANS
7a
preparation so as to justify enforcement action against
such preparation out of the sequence provided by the
Agency’s Compliance Policy Guide 7132c.08.”’
On April 8, 1980, the district court issued an Opinion and
Order explaining and reiterating this order. We treat the two
orders, which are the same but for their date of issuance, as a
single order.
The United States filed separate appeais from the orders
of February 27 and April 8, and these have been consolidated.
The United States also moved for, and we have granted, a
stay pending appeal with respect to the district court’s order
enjoining future seizures, and ordering the return of quantities
of the drug already seized.
The United States presently attacks three aspects of the
district court’s order: (1) its instruction that the FDA ‘‘defer
regulatory action against the WANS preparation ... or
against defendants’ pending further administrative pro-
ceedings; (2) its decision to leave prior seizures of WANS
“‘without effect’’; and (3) its remand of the case to the agen-
cy. We consider these issues in turn; and in connection with
each we also address this court’s appellate jurisdiction. '
The Order To ‘‘Defer’’ Regulatory Action
Our jurisdiction to review the district court’s in-
terlocutory order that the FDA defer further regulatory action
against WANS and Alcon depends on whether the order is ap-
pealable as one granting an injunction, see 28 U.S.C.
§1292(a)(1), or is simply, as Alcon contends, an exercise of
the court’s discretion in controlling a case before it. Looking
to the order’s ‘‘substantial effect,’’ see United States v. Cities
Service Co., 410 F.2d 662, 663 n.1 (Ist Cir. 1969); Hotel &
Restaurant Employees and Barienders International Union v.
Del Valle, 328 F.2d 885, 886 (Ist Cir.), cert. denied, 379 U.S.
' Alcon has moved for summary dismissal of the government’s
appeals, asserting lack of appellate jurisdiction. We advised that we
would consider the motion when deciding the merits.
Ba
879 (1964), we think it was an injunction, hence appealable
under section 1292(a)(1). The order has the effect of forbid-
ding the FDA from exercising in any forum its statutory
power both to proceed against WANS and its producer and to
seize the article pending condemnation. Absence of the word
‘enjoin’ does nothing to mitigate the blanket severity of the
decree. Whether regulatory action against a possibly unsafe or
ineffective drug must be ‘‘deferred’’ or is ‘‘enjoined’’ is a
matter of semantics. In either case, the agency is denied the
ability to take summary steps to protect those to whom the
drug will be distributed in the interim.
This injunction exceeded the district court’s authority. To
prevent this sort of eroding of the agency’s protective powers,
the Supreme Court in Ewing v. Mytinger & Casselberry, Inc.,
339 U.S. 594 (1950), held that district courts lack jurisdiction
to enjoin multiple seizure actions instituted by the FDA under
the Act. The rule of Ewing has been consistently and strictly
observed, see Southeastern Minerals, Inc. v. Harris, 622 F.2d
758 (Sth Cir. 1980); Pharmadyne Laboratories, Inc. v. Ken-
nedy, 596 F.2d 568 (3d Cir. 1979); Parke, Davis & Co. v.
Califano, 564 F.2d 1200 (6th Cir. 1977), cert. denied, 435
U.S. 942 (1978); Natick Paperboard Corp. v. Weinberger, 498
F.2d 125 (Ist Cir. 1974), cert. denied, 429 U.S. 819 (1976),
and controls the present case. We see no distinction between
this case and Ewing merely because the latter involved multi-
ple seizures for alleged misbranding, which may be instituted
only when there is probable cause to believe that the article is
dangerous or that the misbranding may be fraudulent or
misleading. Risks to consumers may be present in new drug
cases, and the same section of the Act is involved. See 21
U.S.C. § 334(a)(1). The Supreme Court’s decision in Ewing
precludes judicial interference with the FDA’s decision to in-
stitute enforcement actions, whatever the precise context.
Compare Southeastern Minerals, supra, 622 F.2d at 763-64
with Parke, Davis & Co., supra, 564 F.2d at 1205 and Natick
Paperboard, supra, 498 F.2d at 126-27. Alcon’s argument that
such a rule exposes a manufacturer to potentially devastating
9a
hardship and loss was disposed of in Ewing. See 339 U.S. at
604-05 (Jackson, J., dissenting). The considerations from
which the Ewing holding emerged dictate that it be applied
and that the district court’s order, insofar as it bars initiation
of further FDA enforcement actions, be vacated:
‘‘The purpose of the multiple seizure provision is plain.
It is to arrest the distribution of an article that is
dangerous, or whose labeling is fraudulent or misleading,
pending a determination of the issue of adulteration or
misbranding. The public therefore has a stake in the
jurisdictional issue before us. If the District Court can
step in, stay the institution of seizures, and bring the ad-
ministrative regulation to a halt until it hears the case,
the public will be denied the speedy protection which
Congress provided by multiple seizures.
* * *
‘‘The means which Congress provided to protect con-
sumers against the injurious consequences of protracted
proceedings would then be seriously impaired. Congress
weighed the potential injury to the public from misbrand-
ed articles against the injury to the purveyor of the article
from a temporary interference with its distribution and
decided in favor of the speedy, preventive device of
multiple seizures. We would impair or destroy the effec-
tiveness of that device if we sanctioned the interference
which a grant of jurisdiction to the District Court would
entail. Multiple seizures are the means of protection af-
forded the public. Consolidation of all the libel suits so
that one trial may be had is the relief afforded the
distributors of the articles.’’
339 U.S. at 601-02 (footnotes omitted). See also Premo Phar-
maceutical, supra, 629 F.2d at 801; Natick Paperboard,
supra, 498 F.2d at 127.
10a
The Dissolution Of Prior Seizures
We agree with the United States that so much of the
district court’s order as purports to leave the FDA’s former
seizures ‘‘without effect’’ is appealable as a collateral order.
See Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541
(1949), discussed infra in connection with the remand order.
The present situation is like that in Swift & Co. Packers v.
Compania Colombiana Del Caribe, 339 U.S. 684 (1950),
where the Cohen rule was held to apply. The Supreme Court
there stated,
‘Appellate review of the order dissolving the attachment
at a later date would be an empty rite after the vessel had
been released and the restoration of the attachment only
theoretically possible. Under these circumstances the pro-
vision for appeals only from final decisions in 28 U.S.C.
§ 1291 should not be construed so as to deny effective
review of a claim fairly severable from the context of a
larger litigious process.’’
330,U.S. at 689 (citations omitted). The same can be said as
to the futility of later appellate review of this order requiring,
it would seem, immediate release of the seized suppositories.
We therefore turn to the merits of the present appeal.
It is the government’s contention that the district court
‘*ha[d] no authority simply to give back the seized property
without determining ... whether or not the Act [was]
violated.’? The Act provides that before trial the court shall
‘tallow any party to a condemnation proceeding . . . to obtain
a representative sample of the article seized’’ and that after
condemnation the court has discretion to order the goods sold
or destroyed, 21 U.S.C. § 334(c),(d), but otherwise is silent
upon the release of seized goods prior to a decision upon the
FDA’s claims. Rule E(5)(c) of the Supplemental Rules for
Certain Admiralty and Maritime Claims, which were intended
to inform seizure procedure under the Act, see 21 U.S.C.
§ 334(b), states that seized property held by the marshal
‘‘may be released forthwith upon his acceptance and ap-
proval of a stipulation, bond, or other security, signed by
lla
the party on whose behalf the property is detained or his
attorney and expressly authorizing such release, if all
costs and charges of the court and its officers shall have
first been paid. Otherwise no property in the custody of
the marshal or other officer of the court shall be released
without an order of the court; but such order may be
entered as of course by the clerk, upon the giving of ap-
proved security as provided by law and these rules, or
upon the dismissal or discontinuance of the action; but
the marshal shall not deliver any property so released un-
til the costs and charges of the officers of the court shall
first have been paid.’
Alcon contends that this portion of Rule E(5) implies some
general grant of authority to a court to order the release of
seized. property. However, the purpose and focus of Rule E(5)
is merely to describe the circumstances under which seized
property may be released prior to a court’s determination of
the merits: thus it provides for release of property if a plain-
tiff consents, or when ‘‘approved security as provided by law
and these rules’’ is tendered. Neither circumstance exists here
(and, indeed, in a new drug case, where the purpose of the
seizure is to remove a possibly risky drug from public use, it
is hard to see how the mere putting up of security would be a
proper basis for release). In any event, we see little in Rule
E(5) by way of a general grant of authority permitting courts
to countermand administratively instituted seizures without
first adjudicating the merits of the agency’s claim. If the
seizure is plainly frivolous, the court can act rapidly and
achieve justice in that manner, but its action should ordinarily
follow, not precede, an adjudication. We have found only
two cases that bear on the question. One holds, and the other
Suggests, that articles seized in an FDA enforcement action
may not be released by the court prior to a judicial determina-
tion of whether they violate the Act. See Jn re United States,
140 F.2d 19 (Sth Cir. 1943); United States v. 893 One-Gallon
Cans ... Brown’s Inhalant, 45 F.Supp. 467 (D. Del. 1942).
12a
We conclude that the district court erred in dissolving the
administrative seizures of WANS without first addressing the
merits of the seizure proceedings initiated by the FDA, in-
cluding, as part thereof, the agency’s contention that WANS
is a ‘‘new drug.’’ We therefore vacate this portion of the
district court’s order. The district court believed that allowing
‘the continued retention of the material seized would be an
abuse of judicial discretion’’ in light of its findings that
WANS ‘“‘has been used for years’’ and that ‘‘the information
which prompted the F.D.A. to initiate these actions was not
only contradictory, but also insufficient to allow a causal rela-
tion.’’ These preliminary and necessarily tentative and in-
complete findings cannot serve as a substitute for a deter-
mination on the merits. It has been said that in pursuing a
seizure action, the FDA must first allege sufficient facts to
state a claim and must then prove its claim by a
preponderance of the evidence. See United States v. 47 Bottles
... “Jenasol RJ Formula ‘60’ ’’, 320 F.2d 564, 569-71 (3d
Cir.), cert. denied, 375 U.S. 953 (1963); United States v. 4
Cases ... Slim-Mint Chewing Gum, 300 F.2d 144, 148-50
(7th Cir. 1962). A decision by a district court as to whether
the FDA has met those burdens would be the proper means
for adjudicating the validity of the FDA’s enforcement ef-
forts; a seizure should only be dissolved thereafter, in event of
the government’s failure to do so.
The Remand To The FDA
Remand of a case for further proceedings is ordinarily
not appealable in that it is not a ‘‘final decision’’ from which
appeals may be taken under 28 U.S.C. § 1291. See Pauls v.
Secretary, 457 F.2d 294 (Ist Cir. 1972). The government,
however, argues that the district court’s order in this case is
appealable under section 1291 as a collateral order within the
meaning of Cohen v. Beneficial Industrial Loan Corp., supra,
337 U.S. 541.
In Cohen, the Supreme Court held that a district court’s
refusal to order the plaintiff in a stockholders’ derivative suit
I3a
to post security for costs as required by a state statute was im-
mediately appealable because it fell in ‘‘that small class’’ of
decisions ‘‘which finally determine claims of right separable
from, and collateral to, rights asserted in the action, too im-
portant to be denied review and too independent of the cause
itself to require that appellate consideration be deferred until
the whole case is adjudicated.’’ 337 U.S. at 546. We have in-
terpreted the Court’s formulation in Cohen to require that ap-
pealability be predicated on four characteristics:
“The order must involve: (1) an issue essentially
unrelated to the merits of the main dispute, capable of
review without disrupting the main trial; (2) a complete
resolution of the issue, not one that is ‘unfinished’ or ‘in-
conclusive’; (3) a right incapable of vindication on appeal
from final judgment; ard (4) an important and unsettled
question of controlling law, not merely a question of the
proper exercise of the trial court’s discretion.’’
United States v. Sorren, 605 F.2d 1211, 1213 (1st Cir. 1979),
quoted in In re Continental Investment Corp., No. 80-1362,
slip op. at 6 (Ist Cir. Oct. 31, 1980). The requisites may be
summarized as separability, finality, urgency, and importance.
In re Continental Investment Corp., supra, slip op. at 6. Cf.
Grinnell Corp. v. Hackett, 519 F.2d 595, 596 (Ist Cir.), cert.
denied sub nom. Chamber of Commerce vy. United
Steelworkers, 423 U.S. 1033 (1975) (arguing that ‘‘urgency”’
necessarily subsumes ‘‘finality’’). See generally Firestone Tire
& Rubber Co. v. Risjord, 49 U.S.L.W. 4089, 4090-92 (Jan.
13, 1981). We find each characteristic to be present here and
so hold that the order is appealable.
First, the remand order raises issues that are entirely
separable from the ultimate question to be decided by this
litigation, the ‘“‘new drug’’ status of WANS. In remanding,
the court ordered the FDA to hold ‘‘a hearing pursuant to 5
U.S.C. § 554 and thereafter make[ ] an administrative deter-
mination of the new drug status [of] WANS in conformity
with the enforcement priorities enunciated in FDA’s Com-
pliance Policy Guide 7132c.08.’’ The decree thus implicates
l4a
the power of the agency to summarily initiate enforcement
proceedings under the Act and its own regulations. It also
puts at issue the manner in which FDA enforcement actions
ought to proceed. These issues are independent of the merits
of the underlying claim against WANS. See Lopez v.
Secretary, 512 F.2d 1155 (1st Cir. 1975) (allowing appeal from
remand requiring Secretary of HHEW to show claimant had a
‘‘realistic opportunity’’ of being hired for available positions);
Gueory v. Hampton, 510 F.2d 1222, 1224-25 (D.C. Cir. 1975)
(allowing appeal from remand that required Civil Service
Commission to show how conduct for which employee was
dismissed had diminished the efficiency of the service); Gold
v. Weinberger, 473 F.2d 1376, 1378 (Sth Cir. 1973) (allowing
appeal from remand holding that Secretary of HEW could
not prove availability of reasonable job opportunities by
testimony of vocational expert who had not interviewed
claimant); Cohen v. Perales, 412 F.2d 44 (Sth Cir. 1969),
rev'd on other grounds sub nom. Richardson v. Perales, 402
U.S. 389 (1971) (allowing appeal from remand establishing
agency standards for the admission of hearsay evidence and
holding that hearsay evidence is not substantial evidence to
support agency decision).
Second, the district court’s order is final as to these
issues. There are no further steps that the government can
take to avoid imposition of the procedural requirements it
seeks to challenge here. See Abney v. United States, 431 U.S.
651, 659 (1977). The district court has unambiguously
declared in an order, a subsequent opinion and a denial of a
stay motion that it will take no further actions pending FDA
compliance with its decree. Its order therefore cannot
realistically be characterized as not final because subject to
revision. Compare Coopers & Lybrand vy. Livesay, 437 U.S.
463, 469 (1978); Eluska v. Andrus, 587 F.2d 996, 1001 (9th
Cir. 1978). The district court’s retention of jurisdiction over
the case does not affect the finality of its order. Compare
United Transportation Union y. Illinois Central R.R., 433
F.2d 566, 568 (7th Cir. 1970), cert. denied, 402 U.S. 915
1Sa
(1971), with Transportation-Communication — Division,
Brotherhood of Railway, Airline & Steamship Clerks y. St.
Louis-San Francisco Ry., 419 F.2d 933, 936 (8th Cir. 1969),
cert. denied, 400 U.S. 818 (1970).
Third, review of the remand order is urgent, for if we
lack jurisdiction now over the questions presented, it seems
improbable that they will ever be subject to review. Compare
Gueory, supra, 510 F.2d at 1225 and Gold, supra, 473 F.2d at
1378 and Perales, supra, 412 F.2d at 48 with Coopers &
Lybrand, supra, 437 U.S. at 469 and Loya v. INS, 583 F.2d
1110 (9th Cir. 1978) and Barfield v. Weinberger, 485 F.2d 696
(Sth Cir. 1973).
Fourth and finally, the characteristic of importance is
also present here.
“Importance in this context refers to the scope of
precedential value — to whether a case presents ‘an im-
portant and unsettled question of controlling law’, United
States v. Sorren, supra, 605 F.2d at 1213, a decision as to
which ‘will settle the matter not simply for the case at
hand but for many others’, Grinnell Corp. v. Hackett,
supra, 519 F.2d at 597.’’
Continental Investment Corp., supra, slip op. at 9. The
government’s appeal does not merely challenge an exercise of
the district court’s discretion, see In re Grand Jury Pro-
ceedings, 580 F.2d 13, 17 (Ist Cir. 1978); instead, it raises
broader questions of how FDA enforcement actions are to
proceed. Resolution of these questions is important both to
the future FDA regulatory efforts and to the public, whose
safety may depend upon those efforts. We therefore proceed
to the merits of the government’s contentions.
’ As to the appeal in general, Alcon argues that we are deprived
of jurisdiction by 28 U.S.C. § 2105, which provides
‘‘There shall be no reversal in the Supreme Court or a court of
appeals for error in ruling upon matters in abatement which do
not involve jurisdiction.”’
Passing by the question whether this action is in abatement, we
note that the district court’s remand order can be understood as
l6a
The district court premised its decision to remand to the
FDA on interrelated procedural and substantive grounds. The
court was troubled by the agency’s failure to conduct ‘‘a for-
mal administrative determination of the ‘new drug’ status of
WANS”’ before instituting suit against Alcon. In the absence
of such a determination, the court felt that an FDA internal
regulation — Compliance Policy Guide 7132c.08 — precluded
enforcement action against WANS unless the agency possess-
ed ‘‘significant new information which questions the safety of
the drug.’’ However, the court characterized itself as ill-suited
to decide the ‘‘new drug’’ status of WANS or to determine
whether ‘“‘significant new information’’ existed that questioned
WANS’ safety. Citing lack of jurisdiction, the doctrine of
primary agency jurisdiction and prudential considerations, the
court decided that these questions were better left to ‘‘the
Agency entrusted by Congress with the necessary expertise to
make a responsible determination.’’ Accordingly, it ordered
the action ‘“‘remanded to the Food and Drug Administration
to hold a formal administrative hearing pursuant to 5 U.S.C.
§ 554 on the issue as to whether WANS is a ‘new drug’ in
conformity with the enforcement priorities enunciated in
F.D.A.’s Compliance Policy Guide 7132c.08.’’
involving jurisdiction, see Aetna State Bank v. Altheimer, 430 F.2d
750, 753 (7th Cir. 1970), and our disposition of the case is not,
technically, a ‘‘reversal,’’ see 15 Wright, Miller & Cooper, Federal
Practice & Procedure: Civil § 3903, at 414-15 (1976). In any event,
despite its plain language section 2105 has never been interpreted as
a significant limitation on federal appellate jurisdiction:
“‘The most important feature of § 2105 is certainly its
disuse.
* * *
**[Ajppellate review ... is notoriously frequent with respect to
such problems as abstention of federal decision in deference to
State proceedings, deferral of judicial decision pending resort to
the ‘primary jurisdiction’ of administrative agencies, or a
requirement that private grievance proceedings be exhausted
before seeking judicial interference in labor-management
relations.”’
15 Wright, Miller & Cooper, supra, § 3903, at 414.
17a
The court’s concern over summary institution of enforce-
ment proceedings is shared by some in the drug industry, see
Swire, FDA’s Multiple Seizure Powers: A Time for Equity, 34
Food, Drug, Cosmetic L.J. 244 (1979), but the imposition of
a pre-enforcement hearing requirement (coupled with
preliminary relief, as, to be meaningful, it would have to be)
is at odds with the language and intent of the Act. To be
sure, in certain circumstances a formal administrative pro-
ceeding is a precondition to agency action. For example, when
the FDA issues, pursuant to 5 U.S.C. § 554(e), a declaratory
order governing all drugs covered by a particular new drug
application, or when it withdraws approval of a new drug ap-
plication pursuant to 21 U.S.C. § 355(e), it must first hold a
hearing in compliance with section 554 of the Administrative
Procedure Act, 5 U.S.C. § 554. See Hynson, supra, 412 U.S.
at 620, 625. Each action is a ‘‘case of adjudication required
by statute to be determined on the record after opportunity
for an agency hearing’’ for purposes of the APA, 5 U.S.C.
§ 554(a). See 5 U.S.C. § 554(e) (declaratory order); 21
U.S.C. § 355(e) (withdrawal of NDA). By contrast, there is
no statutory hearing requirement for FDA decisions to initiate
seizure Or injunction actions. See 21 U.S.C. §§ 332, 334. In-
deed, the probable cause determination necessary to institute
multiple seizure actions against allegedly misbranded products
is to be made ‘‘without hearing.’’ 21 U.S.C. § 334(a)(1). As
the Supreme Court has made abundantly clear, a manufac-
turer subjected to an FDA enforcement action has no right to
raise objections in an administrative forum prior to the
agency’s institution of the action. See Ewing, supra, 339 U.S.
594. Cf. Abbott Laboratories v. Gardner, 387 U.S. 136,
146-48 (1967) (reaffirming Ewing and distinguishing it from
declaratory action brought by drug manufacturers challenging
FDA regulations prior to their enforcement). This is because
the imposition of any formal, pre-enforcement hearing re-
quirement might seriously impair the effectiveness of the Act’s
enforcement provisions. See id.
The district court’s concern that the FDA might be pro-
ceeding in violation of its own internal regulatory guidelines
l8a
was also in error. Compliance Policy Guide 7132c.08
establishes FDA enforcement priorities for specific types of
drugs, see infra, and declares that the FDA will depart from
those priorities only under specified circumstances, one being
receipt of ‘‘significant new information which questions the
safety or effectiveness of the drug.’’ A brief review of the
history’ and text of Compliance Policy Guide 7132c.08,
however, demonstrates that the guideline does not apply to
WANS.
Under the 1938 Federal Food, Drug, and Cosmetic Act, a
drug had only to be proven safe to be approved by the FDA
for interstate marketing. Approval of a new drug application
was automatic within a fixed period after submission unless
the FDA in the interim affirmatively disapproved it. The 1962
amendments to the Act substantially modified these
premarketing clearance procedures. A ‘‘new drug’’ was
redefined to be one not generally recognized among experts as
effective as well as safe, and the automatic approval of new
drug applications was eliminated. A ‘‘new drug’’ therefore
could not be lawfully marketed unless it satisfied both the
safety and effectiveness requirements of the Act and had been
affirmatively approved by the FDA. These changes presented
the FDA with an enormous problem: By virtue of the 1962
amendments thousands of drugs with NDA’s already approv-
ed for safety, but not effectiveness (‘‘pioneer’’ drugs), and
many more thousands of drugs considered generically iden-
tical to already approved drugs (‘‘me-too’’ drugs), became
‘‘new drugs’’ subject to the agency clearance procedure of
*Our discussion draws on several sources: United States v.
Lannett Co., 585 F.2d 575 (3d Cir. 1978); Hoffmann-LaRoche, Inc.
v. Weinberger, 425 F. Supp. 890 (D.D.C. 1975); Fleshner, Lannett,
Premarketing Clearance and ‘‘Me-Too’’ Drugs; Where Do We Go
From Here?, 35 Food, Drug, Cosmetic L.J. 44 (1980); Note,
Regulating Laetrile: Constitutional and Statutory Implications, 5 U.
Dayton L. Rev. 155 (1980); Note, New Drug Approval: Lannett,
The Drug Lag, and the NDA System, 11 Rut.-Cam. L.J. 231
(1980).
1¥a
section 505 of the Act, 21 U.S.C. § 355. To speed its newly
created job of determining the effectiveness of these drugs,
the FDA arranged to have the National Academy of Sciences-
National Research Council conduct a Drug Efficiency [sic]
Study of nearly 4,000 drugs. The results of this study were in-
corporated into Drug Efficiency [sic] Study Implementation
(DESI) notices that indicated whether or not the FDA con-
sidered particular drugs to be effective. All distributors of
drugs covered by a DESI notice and not holding an approved
new drug application were variously required to submit either
a full or abbreviated new drug application. However, upon
submission and prior to approval of the required application,
manufacturers of me-too drugs were permitted to market their
products if a full new drug application had already been ap-
proved for the related pioneer drug. This approach to the ad-
ministrative problems created by the 1962 amendments was
struck down in Hoffmann-LaRoche, Inc. v. Weinberger, 425
F. Supp. 890 (D.D.C. 1975), which held that no new drug —
pioneer or me-too — could be introduced into interstate com-
merce without its new drug application having first been ap-
proved by the FDA.
Compliance Policy Guide 7132c.08 is the FDA’s attempt
to incorporate into the DESI program the holding of
Hoffmann-LaRoche. Recognizing that independent evaluation
of the effectiveness of all DESI drugs will unavoidably delay
achievement of industry-wide compliance with the Act, the
Guide sets out ‘‘a strategy to deal on a priority basis with
those drugs which most affect public health and safety[,] to
provide equitable treatment among competing firms, and to
have a maximum impact on violative products.’’ It establishes
FDA enforcement priorities according to two general groups
of drugs: ‘‘DESI prescription drugs where a final determina-
tion on effectiveness has been made’’ and ‘‘DESI and other
prescription drugs where a final determination on effec-
tiveness has not been niade.’’ Each group is further divided
into several smaller categories.
20a
WANS is not covered by Compliance Policy Guide
7132c.08 because it is not part of the DESI program. As
Alcon expressly acknowledges, WANS is neither a pioneer
drug (it is not covered by a pre-1962 NDA) nor a me-too drug
(it is not generically identical to a pioneer drug). To read the
phrase ‘‘other prescription drugs where a final determination
on effectiveness has not been made,’’ supra, as including
WANS would impermissibly extend the Compliance Policy
Guide far beyond its historic context and purpose. The proper
scope of the second group of drugs defined by the Com-
pliance Policy Guide is illustrated by its three subcategories,
none of which applies to WANS. It is true, as Alcon points
out, that the FDA’s initial regulatory letter described WANS
as falling under this category, but later correspondence omit-
ted this reference. In any event, Alcon does not claim that
what the government concedes to have been an unfortunate
mistake might now estop it from correctly treating WANS as
a drug not covered by the Guide. The district court was thus
in error to require that the FDA comply with Compliance
Policy Guide 7132c.08 and withhold regulatory action against
WANS in the absence of ‘“‘significant new information which
questions the safety or effectiveness of the drug.’’
Finally, we turn to the district court’s belief that it lack-
ed, or should not have exercised, jurisdiction over the ‘‘new
drug’’ and ‘‘grandfather clause’’ questions in this case. The
court’s declaration that ‘‘[iJt is not within the jurisdiction of
this Court to determine whether the drug in issue is or is not a
new drug”’ is plainly incorrect. Jurisdiction over the new drug
issue is shared by the FDA, see Weinberger v. Bentex Phar-
maceuticals, Inc., 412 U.S. 645, 653 (1973); Hynson, supra,
412 U.S. at 624, and the federal district courts, see C/BA
Corp. v. Weinberger, 412 U.S. 640, 644 (1973); Premo Phar-
maceutical, supra, 629 F.2d at 801; United States v. X-OTAG
Plus Tablets’’, 602 F.2d 1387 (10th Cir. 1979); United States
v. Mosinee Research Corp., 583 F.2d 930, 931-32 (7th Cir.
1978).
2la
Further, the district court’s invocation of the doctrine of
‘‘primary jurisdiction’’ to justify its refusal to exercise its own
jurisdiction is not persuasive. As we have elsewhere stated,
deference to an agency’s primary jurisdiction makes little
sense in the context of an enforcement proceeding initiated by
the agency. JCC v. B & T Transportation Co., 613 F.2d 1182,
1187 (Ist Cir. 1980). This is especially true where, as here, a
party remains subject to the agency’s regulatory efforts
despite the remand. We have held above that a district court
lacks the power to require the FDA to defer seizures pendente
lite or to order release of seized drugs prior to a determina-
tion of the merits of the agency’s claims. The effect of a re-
gmand to the agency thus would hardly be beneficial to the
product’s manufacturer. Without the relief afforded by the
other aspects of the district court’s order, Alcon would be
deprived of a judicial remedy in return for an administrative
procedure of uncertain duration before an unsympathetic
agency. We would be surprised if either Alcon or the district
court would be content with a remand under such cir-
cumstances. With this consideration in mind, and in view of
the fact that the FDA’s current position on the ‘‘new drug’’
status of WANS is already clear; that the FDA carries the
burden of proving its position at trial; and that the agency has
no duty to hold a pre-enforcement hearing or to justify its ac-
tion under its Compliance Policy Guide, see supra, we do not
see what would be gained in this case by a remand. At least it
can be said that two fundamental purposes of deference to
agency jurisdiction — ‘‘coordinating administrative and
judicial machinery’’ and assuring uniformity of regulation,
Mashpee Tribe v. New Seabury Corp., 592 F.2d 575, 580 (ist
Cir.), cert. denied, 444 U.S. 866 (1979) — would not be serv-
ed by the district court’s order. See generally Litton Systems,
Inc. v. Southwestern Bell Telephone Co., 539 F.2d 418 (Sth
Cir. 1976); Mississippi Power & Light Co. v. United Gas Pipe
Line Co., 532 F.2d 412 (Sth Cir. 1976), cert. denied, 429 U.S.
1094 (1977); ICC v. All-American, Inc., 505 F.2d 1360,
1362-64 (7th Cir. 1974).
22a
This is not to say that a remand in the context of en-
forcement proceedings might never be appropriate. In Bentex
Pharmaceuticals, supra, 412 U.S. 645, the Supreme Court
upheld the power of a district court to refer to the FDA ‘‘new
drug’’ and ‘‘grandfather clause’’ issues initially presented to
the court in a declaratory judgment action instituted by drug
manufacturers. The Court went on to note that a court could
stay its hand ‘‘[e]ven where no . . . administrative determina-
tion has been made and the issue arises in a district court in
enforcement proceedings. .. .’’ 412 U.S. at 652. This obser-
vation, however, should be understood in relation to the
situation in Bentex, where some 21 drug manufacturers had
requested declaratory relief. There the court was in essence
being asked to issue, without benefit of prior administrative
proceedings, a decision upon whether a substantial portion of
an industry was complying with the Act. Here the district
court is being asked only to decide whether a single drug
manufactured by a single company is being marketed illegally.
The agency’s view of the question is clear and will have to be
substantiated for the agency to prevail in court. We therefore
conclude that under Bentex this is not an appropriate case for
a remand.
As the district court recognized, a third purpose of the
doctrine of primary jurisdiction — taking advantage ‘‘of
agencies’ special expertise,’’ Mashpee Tribe, supra, 592 F.2d
at 580 — weighs in favor of a remand, but not, we think,
decisively. The Supreme Court has described the ‘‘new drug’’
and ‘‘grandfather clause’ issues as ‘‘the kinds of issues
peculiarly suited to initial determination by the FDA.”’ Bentex
Pharmaceuticals, supra, 412 U.S. at 653. Nevertheless, con-
trary to the Court’s suggestion it has not been ‘‘com-
monplace’’ for courts to await an appropriate administrative
declaration in enforcement proceedings, Bentex, supra, 412
U.S. at 652; lower courts continue to hear and decide the
‘new drug”’ status of drugs challenged by the FDA in seizure
and injunction actions. See, e.g., Premo Pharmaceuticals,
supra, 629 F.2d at 804-05 (issue decided by the court of ap-
23a
peals); ‘‘X-OTAG Plus Tablets’’, supra, 602 F.2d 1387;
Mosinee Research, supra, 583 F.2d 930; United States v. Ar-
ticles of Drug ... Horomin |sic], No. 80-587 (D.N.J. Aug.
29, 1980). The government asserts, and we have found
nothing to the contrary, that of the hundreds of enforcement
actions brought by the FDA under section 505 since 1938,
none save the present has been remanded to the agency.
Returning issues in an enforcement action to the FDA im-
poses an administrative burden for which the Act makes no
provision, and insofar as the procedure delays adjudication of
the regulatory status of a drug, may work to the disadvantag2
not only of the agency and public, but also of the manufac-
turer. In such circumstances the power to remand must be us-
ed sparingly. Had the trial set for May 1979 been held,
WANS’ status would long since have been laid to rest. In
deciding the case, the FDA’s expertise wou.d have been
available to the court, in that to sustain its burden the agency
would have had to present expert evidence establishing its
claims regarding WANS. We therefore conclude that the
district court erred in remanding the case to the FDA.
The orders of the district court are vacated and the case
is remanded for further proceedings consistent with this
opinion.
24a
APPENDIX B
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
Nos. 80-1188, 1357
(Entered February 24, 1981)
UNITED STATES OF AMERICA,
; v.
ALCON LABORATORIES, ETC., ef al.
JUDGMENT
This cause came on to be heard on appeal from the
Unitei States District Court for the District of Puerto Rico,
and was argued by counsel.
Upon consideration whereof, It is now here ordered, ad-
judged and decreed as follows: The orders of the district court
are vacated and the case is remanded for further proceedings
consistent with the opinion filed this day.
Costs to appellant.
By the Court:
/s/ DANA H. GALLUP
Clerk
25a
APPENDIX C
IN THE UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF PUERTO RICO
Nos. 78-2378, 78-1830, 80-243
(Filed February 27, 1980)
UNITED STATES OF AMERICA,
Vv.
ALCON LABORATORIES (PUERTO RICO), INC., ET AL.
Before Juan M. Perez Gimenez, Judge.
ORDER
Consolidated actions Civil 78-2378 and Civil 78-1830
came to be heard on motion of defendants for an order
remanding this action to the Food and Drug Administration
with instructions to defer regulatory enforcement action until
or unless certain conditions are fulfilled.
In view that the seizure action which the Government
filed on January 28, 1980, Civil 80-243, and accomplished on
February 15, 1980, presents essentially the same issues as
those in consolidated actions Civil 78-2378 and Civil 78-1830
the Court ORDERS
That Civil 80-243 be consolidated with prior consolidated
actions No. 78-2378 and 78-1830.
After a careful examination of the arguments presented
by the parties the Court FURTHER ORDERS
26a
That this action be and it is hereby remanded to the Food
and Drug Administration (FDA) with instructions to defer
regulatory action against the WANS preparations involved in
this matter or against defendants based upon the alleged ‘‘new
drug’’ status of WANS until FDA holds a hearing pursuant to
5 USC § 554 and thereafter makes an administrative deter-
mination of the new drug status as WANS in conformity with
the enforcement priorities enunciated in FDA’s Compliance
Policy Guide 7132c. 08.
Accordingly, it is FURTHER ORDERED
That prior seizures ordered by the Court are left without
effect.
However, jurisdiction will be retained whether new,
verifiable and genuinely significant information comes to light
which questions the safety or efficacy of a WANS preparation
sO as to justify enforcement action against such preparation
out of the sequence provided by the Agency’s Compliance
Policy Guide 7132c. 08.
Shortly hereafter, this Court will render an Opinion with
a detailed analysis of the legal grounds for the instant
REMAND.
IT IS SO ORDERED.
In San Juan, Puerto Rico, this 27th day of February,
1980.
/S/ JUAN M. PEREZ GIMENEZ
Juan M. Perez Gimenez
U.S. District Court Judge
27a
APPENDIX D
IN THE UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF PUERTO RICO
Nos. 78-2378, 78-1830, 80-243
(Filed April 9, 1980)
UNITED STATES OF AMERICA,
Vv.
ALCON LABORATORIES (PUERTO RICO), INC., ET AL.
Before Juan M. Perez Gimenez, Judge
OPINION AND ORDER
Through an order issued by this Court on February 27,
1980, this matter was remanded to the Food and Drug Ad-
ministration for further proceedings ‘‘with instructions to
defer regulatory action against the WANS preparations in-
volved in the matter against defendants, based upon the alleg-
ed ‘new drug’ status of WANS until F.D.A. holds a hearing
pursuant to 5 U.S.C. 554, and thereafter makes an ad-
ministrative determination of the new drug status as WANS in
conformity with the enforcement priorities enunciated in
F.D.A.’s Compliance Policy Guide 7132c.08’’.
The present matter consists of three consolidated actions
presenting similar issues.' Involved herein are a series of peti-
' Two of the three actions, Civil No. 78-1830 and 80-0243, are
seizure actions. The other, Civil No. 78-2378, is an injunctive
action, whereby the Food and Drug Administration sought to
28a
tions for seizure and condemnation by the United States of
America under the Federal Food, Drug, and Cosmetic Act, 21
U.S.C. 301, et seq., for seizure and condemnation of WANS,
and any other article of drug consisting of pyrilamine maleate
and pentobarbital sodium, manufactured by Alcon
Laboratories (Puerto Rico), Inc., Humacao, Puerto Rico,
alleging that the aforesaid articles are held illegally within the
jurisdiction of the Court since they are new drugs which may
not be introduced or delivered for introduction into interstate
commerce.
The Government has alleged that the specific articles of
drug are ‘‘new drugs’’ within the meaning of Section 201(p)
of the Federal Food, Drug and Cosmetic Act (the Act), 21
U.S.C. 321(p), and that the articles are misbranded under Sec-
tion 502(f)(1) of the Act, 21 U.S.C. 352(f)(1), in view that
their labeling fails to bear adequate directions for use.
The term ‘‘new drug’’ is defined in 21 U.S.C. 321(p) as
follows:
“(1) Any drug... the composition of which is such that
such drug is not generally recognized among experts
qualified by scientific training and experience to evaluate
the safety and effectiveness of drugs as safe and effective
for use under the conditions prescribed, recommended, or
suggested in the labeling thereof... .
‘*(2) Any drug .. . the composition of which is such that
such drug, as a result of investigations to determine its
safety and effectiveness for use under such conditions has
become so recognized, but which has not, otherwise, than
in such investigations been used to a material extent or
for a material time under such conditions.”’
On the other side, Alcon denies that the seized articles
are ‘‘new drugs’’, and advances three additional arguments in
Support of its position, to wit: (1) that the drugs are entitled
enjoin the defendants from introducing WANS into interstate
commerce without an approved new drug application, a petition for
temporary retraining [sic] order was denied on November 29, 1978.
29a
to the protection under the 1962 ‘‘grandfather’’ clause; (2)
that regulatory action is premature because there is no signifi-
cant new information which questions the safety or effec-
tiveness of the drugs within the meaning of the F.D.A.’s
Compliance Policy Guide 7132c.08 (21 C.F.R. 10.85(e));? (3)
that the initiation of enforcement actions against WANS bas-
ed upon the marketing of WANS without an approved
N.D.A. (New Drug Application) not only violates F.D.A.’s
own rules, policies and regulations (21 C.F.R. 10.85(e)), but
that it is also not in accordance with the law, 5 U.S.C.
706(2)(A).?
In the instant case the Government instituted these ac-
tions based on information obtained by the Food and Drug
Administration which relates to reports of adverse reactions in
221 C.F.R. 10.85(e), (f), provide: ‘‘(e) An advisory opinion
represents the formal position of the Food and _ Drug
Administration on the matter involved, and except as provided in
paragraph (f) of this section obligates the agency to follow it until it
is amended or revoked. The Commissioner shall not recommend
legal action against any person or product with respect to any
action taken in conformity with an advisory opinion which has not
been amended or revoked.
‘“(f) In unusual situations involving an immediate and
significant danger to health, the Commissioner may _ take
appropriate civil enforcement action contrary to an advisory
opinion issued pursuant to this section prior to amending or
revoking such advisory opinion as provided in paragraph (g) of this
section. Appropriate amendment or revocation of the advisory
opinion involved shall be expedited.”’
‘5 U.S.C. 706(2)(A) provides: ‘‘To the extent necessary to
decision and when presented, the reviewing court shall decide all
relevant questions of law, interpret constitutional and statutory
provisions and determine the meaning or applicability of the terms
of an agency action. The reviewing court shall:
(2) hold unlawful and set aside agency action, findings, and
conclusions found to be
(A) arbitrary, capricious, an abuse of discretion, or otherwise not
in accordance with law.’’
30a
children who were treated for nausea and vomiting with drugs
containing pyrilamine maleate and pertobarbital [sic] sodium.
Alcon contends that the information is not new informa-
tion within the meaning of the Compliance Policy Guide. It is
averred that the seven adverse reactions in question occurred
between 1970 and 1974 (as per deposition of Dr. James F.
Schwartz on February 13, 1979), that the attending physi-
cians, contrary to what they say, did not consider these reac-
tions significant enough at the time in view of the failure to
report them to the Food and Drug Administration (as per Dr.
Pruitts’ deposition, p. 40), and that the regulatory letter was
issued more than 14 months later from the period of time
mentioned before.
The validity of the ‘‘new information’? has been further
challenged by Alcon. It has been alleged that each adverse
reaction was associated with an ‘‘overdose’’ and that each pa-
tient was dehydrated; that dehydration itself produces similar
symptoms.‘ Additionally, there is the fact that in most of the
cases cited the patient was receiving or had recently received
other drug therapy.
Furthermore, there are discrepancies between Dr. Pruitt’s
Drug Experience Reports as submitted to F.D.A. and Dr.
Schwartz’ notes from the hospital charts of the seven patients
as to the amount, dosage, strength, and brand name of the
antihistamine barbiturate drug administered, and as to the
prior or concurrent drug therapy.
Certainly, in these actions complex technical determina-
tions are involved concerning the ‘‘new drug’’ issue. The
definition of ‘‘new drug’’ as used in Section 201(p), involves a
determination of technical and scientific questions by experts.
Ciba Corp. v. Weinberger, 412 U.S. 640 643 (1973).
‘Dr. Pruitt, who collected the information on the adverse
reactions cited by F.D.A., indicated that lack of drug therapy in
cases Of pernicious vomiting can cause dehydration which in turn
can result in the same adverse reactions said to be associated with
the antihistamine barbiturate products.
3la
Moreover, the determination of whether a drug is generally
recognized as safe and effective within the meaning of Section
201(p)(1) necessarily implicates complex chemical and phar-
macological considerations. Weinberger v. Bentex Phar-
maceuticals, 412 U.S. 645 (1973). When as in the present ac-
tion there are conflicts arising from the medical data, an
order to remand would be the most adequate determination.
In the case of Weinberger v. Bentex Pharmaceuticals,
supra, the United States Supreme Court ruled that the evalua-
tion of conflicting reports as to the reputation of drugs
among experts in the field is not a matter well left to a court
without chemical or medical background, and further
established that threshold questions within the peculiar exper-
tise of an administrative agency are appropriately routed to
the agency, while the courts stays its hand. Weinberger.
Bentex, supra, at 653-654.
The present actions have been instituted without a formal
administrative determination of the ‘‘new drug’’ status of
WANS, the issue first being tendered to the district court.
The Act does not create a dual system of control, one ad-
ministrative and one judicial, for it is the agency’s primary
jurisdiction to determine the status of drugs under the Act.
Thus, issues presented herein may be more effectively
evaluated at the administrative than at the judicial level, and a
remand would promote both administrative and judicial
economy. The question whether the drug is to be recognized
as ‘‘safe and effective’? or was ‘‘grandfathered in’’ are the
kinds of issues peculiarly suited to initial determination by the
Food and Drug Administration. Weinberger v. Bentex, supra,
at 653.
Given the present state of the evidence on record, a re-
mand would be the most proper action to be _ taken.
Weinberger v. Bentex, supra, at 654.
It is not within the jurisdiction of this Court to determine
_whether the drug in issue is or is not a new drug. Such deci-
sion corresponds, and is to be made by the Food and Drug
32a
Administration, the Agency entrusted by Congress with the
necessary expertise to make a responsible determination. A re-
mand to the F.D.A. would be the most appropriate action to
be taken in view of the characteristics of the case as reflected
through information generated by the discovery had so far in
the cases and which appears on the record.
There is evidence in the record which establishes that the
WANS proportions have been used under medical supervision
for approximately twenty five years. In conjunction with this
fact we have to consider that the alleged ‘‘new information”’
poses a series of conflicts when examined with other evicence
on record. Both factors are determinant for any conclusion by
the Court as to whether regulatory action against WANS
violates C.P.G.°
Since no final determination has been made with respect
to WANS, in order to proceed or initiate regulatory action
against the product, there must be significant new information
which questions the safety of the drug. At this stage, and in
the light of the ‘‘new information’’ the Court cannot make a
well-informed decision and is unable to determine the direct
relationship establishing that WANS is an unsafe product. As
a corollary to this, the Court, given the conflicts which appear
from the evidence, is in no position to ascertain whether the
F.D.A.’s enforcement actions against WANS are consistent
with its Compliance Policy Guide.°
This Court finds that issues pending in these actions
revolve and are dependent on the ‘‘new drug’’ status of the
WANS, this in turn being a matter to be resolved at the agen-
cy level. C.B.A. Corp. v. Weinberger, supra.
* The Food and Drug Administration’s Compliance Policy Guide
7132c.08 constitutes an advisory opinion/guideline enunciating
F.D.A.’s ‘‘new drug’’ enforcement properties. 21 C.F.R. 10.85,
10.90.
* It has been established that enforcement actions premised upon
the Government’s contravention of the Compliance Policy Guide
cannot stand. N.L.R.B. v. Welcome American Fertilizer Co., 443
F.2d 19 (9 Cir. 1971).
33a
Wherefore, in view of the foregoing, the Court hereby
ORDERS that consolidated cases Civil Nos 78-2378, 78-1830
and 80-0243, be remanded to the Food and _ Drug
Administration to hold a formal administrative hearing
pursuant to 5 U.S.C. 554 on the issue as to whether WANS is
a ‘‘new drug’’ in conformity with the enforcement priorities
enunciated in F.D.A.’s Compliance Policy Guide 7132c.08.
The Court will retain jurisdiction over these actions for
purposes of (1) determining whether any verifiable and gen-
uinely significant new information comes to light which
questions the safety and efficacy of a WANS preparation so
as to justify enforcement action against such preparations out
of the sequence provided by the Agency’s Compliance Policy
Guide 7132c.08, and; (2) resolving any issues remaining
following the issuance of a final administrative order after a
formal administrative hearing on the ‘‘new drug’’ status of
WANS in conformity with the enforcement priorities
established in Compliance Policy Guid [sic] 7132c.08.
IT IS SO ORDERED.
San Juan, Puerto Rico, April 8, 1980.
/s/ JUAN M. PEREZ-GIMENEZ
Juan M. Perez-Gimenez
U. S. District Judge
34a
APPENDIX E
IN THE UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF PUERTO RICO
Nos. 78-2378, 78-1830, 80-0243
(Filed April 29, 1980)
UNITED STATES OF AMERICA
V.
ALCON LABORATORIES (PUERTO RICO), INC., ET AL.
Before Juan M. Perez Gimenez, Judge
ORDER
On February 27, 1980, this Court entered an order
remanding this matter to the Food and Drug Administration.
The government was instructed to defer regulatory action
against the products involved herein, and it was further
ordered that the preceding seizure action be left without
effect.
Thereafter the plaintiff moved for a stay of the order
pending appeal. The motion, having been opposed by defend-
ants and having been extensively argued by the parties, now
stands submitted pending decision by this Court.
The government’s motion is grounded on the contention
that there is no statutory authority to enjoin the Food and
Drug Administration from instituting seizure action under the
Act. It strongly relies on the case of Ewing v. Mytinger &
Casselberry, Inc., 339 U.S. 594 (1950). However, the case is
inapposite to the issues presented in the instant case. The issue
35a
presented in Ewing v. Mytinger, supra, was whether the Food
and Drug Administration should be enjoined from initiating
enforcement action and not, as in the present case, whether
after enforcement action has been initiated, the Court in the
exercise of its sound discretion, can remand the case to the
Agency for a formal administrative determination.
For the reasons advanced in our Opinion and Order of
April 8, 1980, the matter was to be remanded to the Food and
Drug Administration to determine whether the product is a
‘‘new drug’’.
Contrary to plaintiff's contention, even in enforcement
proceedings, a remand may be ordered by the Court:
‘‘Rven when no such administrative determination has
been made and the issue arises in a district court in en-
forcement proceedings, it would be commonplace for the
court to wait an appropriate administrative declaration
before it acted.’’ (Emphasis supplied) 412 U.S. 645, at
652 (1973).
In view of our findings to the effects that the product has
been used for years, and considering the factors' which
strengthen the Court’s determination to remand, to allow the
continued retention of the material seized would be an abuse
of judicial discretion.
WHEREFORE, in view of foregoing, the government’s
motion for stay pending appeal is hereby DENIED; and it is
further ordered that one box of each of WANS children,
WANS #1, WANS #2, from each of the seizures, be retained
under seal pending a final determination of the new drug
status of WANS.
' The information which prompted the F.D.A. to initiate these
actions was not only contradictory, but also insufficient to allow a
causal relation. In all but one case the reactions were associated
with an overdos , and also there were alternative causes to which
the adverse reactions may be attributed.
IT IS SO ORDERED.
San Juan, Puerto Rico, April 29, 1980.
/S/ JUAN M. PEREZ-GIMENEZ
Juan M. Perez-Gimenez
U. S. District Judge
37a
APPENDIX F
1. 21 U.S.C. §334 provides in pertinent part:
(a) (1) Any article of food, drug, or cosmetic that is
adulterated r misbranded when introduced into or while in
interstate commerce or while held for sale (whether or not the
first sale) after shipment in interstate commerce, or which
may not, under the provisions of section 404 or 505, be in-
troduced into interstate commerce, shall be liable to be pro-
ceeded against while in interstate commerce, or at any time
thereafter, on libel of information and condemned in any
district court of the United States or United States court of a
Territory within the jurisdiction of which the article is found:
Provided, however, That no libel for condemnation shall be
instituted under this Act, for any alleged misbranding if there
is pending in any court a libel for condemnation proceeding
under this Act based upon the same alleged misbranding, and
not more than one such proceeding shall be instituted if no
such proceeding is so pending, except that such limitations
Shall not apply (A) when such misbranding has been the basis
of a prior judgment in favor of the United States, in a
criminal, injynction, or libel for condemnation proceeding
under this Act, or (B) when the Secretary has probable cause
to believe from facts found, without hearing, by him or any
officer or employee of the Department that the misbranded
article is dangerous to health, or that the labeling of the
misbranded article is fraudulent, or would be in a material
respect misleading to the injury or damage of the purchaser or
consumer. In any case where the number of libel for condem-
nation proceedings is limited as above provided the pro-
ceeding pending or instituted shall, on application on the
claimant, seasonably made, be removed for trial to any
district agreed upon by stipulation between the parties, or, in
case Of failure to so stipulate within a reasonable time, the
claimant may apply to the court of the district in which the
seizure has been made, and such court (after giving the United
States attorney for such district reasonable notice and oppor-
tunity to be heard) shall by order, unless good cause to the
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contrary is shown, specify a district of reasonable proximity
to the elaimant’s principal place of business to which the case
shall be removed for trial.
* * *
(b) The article, equipment, or other thing proceeded
against shall be liable to seizure by process pursuant to the
libel, and the procedure in cases under this section shall con-
form, as nearly as may be, to the procedure in admiralty; ex-
cept that on demand of either party any issue of fact joined in
any such case shall be tried by jury. When libel for condem-
nation proceedings under this section, involving the same
claimant and the same issues of adulteration or misbranding,
are pending in two or more jurisdictions, such pending pro-
ceedings, upon application of the claimant seasonably made
to the court of one such jurisdiction, shall be consolidated for
trial by order of such court, and tried in (1) any district
selected by the claimant where one of such proceedings is
pending; or (2) a district agreed upon by stipulation between
the parties. If no order for consolidation is so made within a
reasonable time, the claimant may apply to the court of one
such jurisdiction, and such court (after giving the United
States attorney for such district reasonable notice and oppor-
tunity to be heard) shall by order, unless good cause to the
contrary is shown, specify a district of reasonable proximity
to the claimant’s principal place of business, in which all such
pending proceedings shall be consolidated for trial and tried.
Such order of consolidation shall not apply so as to require
the removal of any case the date for trial of which has been
fixed. The court granting such order shall give prompt
notification thereof to the other courts having jurisdiction of
the cases covered thereby.
2. 21 U.S.C. §332 provides:
(a) The district courts of the United States and the United
States courts of the Territories shall have jurisdiction, for
cause shown, and subject to the provisions of section 38]
(relating to notice to opposite party) of Title 28, to restrain
violations of section 301 of this title, except paragraphs (h),
(i), and (j) of said section.
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(b) In case of violation of an injunction or restraining
order issued under this section, which also constitutes a viola-
tion of this Act, trial shall be by the court, or, upon demand
of the accused, by a jury. Such trial shall be conducted in ac-
cordance with the practice and procedure applicable in the
case of proceedings subject to the provisions of section 22 of
such Act of October 15, 1914, as amended. [This section,
which appeared as U.S.C., title 28, sec. 387, has been repeal-
ed. It is now covered by Rule 42(b), Federal Rules of
Criminal Procedure.]
3. 21 U.S.C. §321 provides in pertinent part:
For the purposes of this Act — (p) The term ‘‘new drug’’
means — (1) Any drug (except a new animal drug or an
animal feed bearing or containing a new animal drug) the
composition of which is such that such drug is not generally
recognized, among experts qualified by scientific training and
experience to evaluate tne safety and effectiveness of drugs, as
safe and effective for use under the conditions prescribed,
recommended, or suggested in the labeling thereof, except
that such a drug not so recognized shall not be deemed to be
a “‘new drug’’ if at any time prior to the enactment of this
Act it was subject to the Food and Drugs Act of June 30,
1906, as amended, and if at such time its labeling contained
the same representations concerning the conditions of its use;
-
(2) Any drug (except a new animal drug or an animal
feed bearing or containing a new animal drug) the composi-
tion of which is such that such drug, as a result of investiga-
tions to determine its safety and effectiveness for use under
such conditions, has become so recognized, but which has
not, otherwise than in such investigations, been used to a
material extent or for a material time under such conditions.
*““ENACTMENT DATE’’ AS DEFINED IN DRUG
AMENDMENTS ACT OF 1962
Sec. 107 of P.L. 87-781
Sec, 107(c)(1) [As used in this subsection? the term ‘‘enactment
date’’ méans the date of enactment of this Act; and the term ‘‘basic
40a
4. 21 U.S.C. §355 provides in pertinent part:
(a) No person shall introduce or deliver for introduction
into interstate commerce any new drug, unless an approval of
an application filed pursuant to subsection (b) is effective with
respect to such drug. :
Act’’ means the Federal Food, Drug, and Cosmetic Act.
(2) An application filed pursuant to section 505(b) of the basic
Act which was ‘‘effective’’ within the meaning of that Act on the
day immediately preceding the enactment date shall be deemed, as
of the enactment date, to be an application ‘‘approved’’ by the
Secretary within the meaning of the basic Act as amended by this
Act.
(3) In the case of any drug with respect to which an application
filed under section 505(b) of the basic Act is deemed to be an
approved application on the enactment date by virtue of paragraph
(2) of this subsection —
(A) the amendments made by this Act to section 201(p),
and to subsections (b) and (d) of section 505, of the basic Act,
insofar as such amendments relate to the effectiveness of
drugs, shall not, so long as approval of such application is not
withdrawn or suspended pursuant to section 505(e) of that Act,
apply to such drug when intended solely for use under
conditions prescribed, recommended, or suggested in labeling
covered by such approved application, but shall apply to any
changed use, or conditions of use, prescribed, recommended,
or suggested in its labeling, including such conditions of use as
are the subject of an amendment or supplement to such
application pending on, or filed after, the enactment date; and
(B) clause (3) of the first sentence of section 505(e) of the
basic Act, as amended by this Act, shall not apply to such drug
when intended solely for use under ccnditions prescribed,
recommended, or suggested in labeling covered by such
approved application (except with respect to such use, or
conditions of use, as are the subject of an amendment or
supplement to such approved application, which amendment or
supplement has been approved after the enactment date under
section 505 of the basic Act as amended by this Act) until
whichever of the following first occurs: (i) the expiration of the
two-year period beginning with the enactment date; (ii) the
effective date of an order under section 505(e) of the basic Act,
other than clause (3) of the first sentence of such section
505(e), withdrawing or suspending the approval of such
application.
4la
5. 21 U.S.C. §351 provides in pertinent part: A drug or
device shall be deemed to be adulterated—
(a)(1) If it consists in whole or in part of any filthy,
putrid, or decomposed substance; or (2)(A) if it has been
prepared, packed, or held under insanitary conditions
whereby if may have been contaminated with filth, or
whereby it may have been rendered injurious to health; or (B)
if it is a drug and the methods used in, or the facilities or
controls used for, its manufacture, processing, packing, or
holding do not conform to or are not operated or ad-
ministered in conformity with current good manufacturing
practice to assure that such drug meets the requirements of
this Act as to safety and has the identity and strength, and
meets the quality and purity characteristics, which it purports
or is represented to possess; or (3) if its container is compos-
ed, in whole or in part, of any poisonous or deleterious
substance which may render the contents injurious to health;
or (4) if (A) it bears or contains, for purposes of coloring on-
ly, a color additive which is unsafe within the meaning of sec-
tion 706(a), or (B) it is a color additive the intended use of
which in or on drugs or devices is for purposes of coloring
only and is unsafe within the meaning of section 706(a); or (5)
if it is a new animal drug which is unsafe within the meaning
of section 512; or (6) if it is an animal feed bearing or con-
taining a new animal drug, and such animal feed is unsafe
within the meaning of section 512.
(4) In the case of any drug which, on the first day immediately
preceding the enactment date, (A) was commercially used or sold in
the United States, (B) was not a new drug as defined by section
201(p) of the basic Act as then in force, and (C) was not covered by
an effective application under section 505 of that Act, the
amendments to section 201(p) made by this Act shall not apply to
such drug when intended solely for use under conditions prescribed,
recommended, or suggested in labeling with respect to such drug on
that day.]
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6. 21 U.S.C. §352 provides in pertinent part:
A drug or device shall be deemed to be misbranded —
* . *
(j) If it is dangerous to health when used in the dosage or
manner, or with the frequency or duration prescribed, recom-
mended, or suggested in the labeling thereof.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.