Amicus Curiae Brief — Thompson v. Western States Medical Center

No. 01-344

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In the Supreme Court of the Anited States

TOMMY G. THOMPSON, .

SECRETARY OF HEALTH AND HUMAN SERVICES, ET AL..

Petitioners,

Vv.

WESTERN STATES MEDICAL CENTER, ET AL..

Respondents.

On Writ of Certiorari to the

United States Court of Appeals

for the Ninth Circuit

BRIEF OF THE INTERNATIONAL ACADEMY

OF COMPOUNDING PHARMACISTS AS

AMICUS CURIAE IN SUPPORT OF RESPONDENTS

JEFFREY N. GIBBS ALAN E. UNTEREINER

JENNIFER B. DAVIS ARNON D. SIEGEL*

JEFFREY N. WASSERSTEIN Robbins, Russell, Englert,

Hyman, Phelps & McNamara, PC Orseck & Untereiner LLP

700 Thirteenth Street, N.W. 1801] K Street, N.W.

Suite 1200 Suite 411

Washington, D.C. 20005 Washington, D.C. 20006

(202) 737-5600 (202) 775-4500

* Counsel of Record

REST AVAILABLE COPY

TABLE OF CONTENTS

~ Page

Se PEIN oscccccccccceceeeessccee ili

INTEREST OF THE AMICUS CURIAE ............4.. l

SUMMARY OF ARGUMENT ...............0..005. |

i epee nancies edie endess 2

tee ek badd e sada bbed enesevernens 2

Il. Historical Evidence Belies the Government’s

Suggestion that Compounding Was Illegal

a SN a SS 6

A. Compounding Has Always Been an

Accepted Part of the Practice of Pharmacy ...... 6

B. Pharmacists Supported the Passage

Ee ii eke eh Chee GehNhen eb be bnekees 7

C. The Legislative History of the FDCA

Demonstrates the Acceptance of the

Practice of Compounding ................... 9

D. The Actions of the Federal Government

and Members of the Pharmacy Profession,

As Well As Official Compendia, Make Clear

That Compounding Was Not Regulated by

A dices ay pate ea eS ROE SUNG SO 4 v0 e 11

E. Post-Enactment Historical Evidence Supports

the Proposition that Compounding Was Not

SU OGD EIGAR cc ccc ccccccecccccess 14

F. Inthe Years Immediately Prior to Enactment

_ of FDAMA, Compounding Was Widely

Es heck etedkeseeeseeee 17

G. The Legislative History of FDAMA Supports

the Proposition that Compounding Was Not

Regulated by the FDCA.................... 21

i

Il. This Court’s Commercial Speech Doctrine

Protects Advertising for Legal Activities

Such as Pharmacy Compounding ................

CONTAIN occ ccccccccccusvsssesseseeeueens

ill

TABLE OF AUTHORITIES

Page(s)

Cases

Brown & Williamson v. FDA, 529 U.S. 120 (2000) ..... 4-5

Cedars North Towers Pharmacy, Inc. v.

United States, [1978-1979 Transfer Binder]

Food Drug Cosm. L. Rep. (CCH) 4 38,200

SL PE PUTED coscccccccceccccccceccs 5

Central Hudson Gas & Elec. Corp. v.

Public Serv. Comm'n, 447 U.S. 557 (1980) ..... passim

Professionals & Patients for Customized Care

v. Shalala, 56 F.3d 592 (Sth Cir. 1995) ............ 5

United States v. 9/1 Kg. Containers, 854 F.2d 173

Eine ndceseeseocsocoocesecese 5

United States v. Algon Chem. Inc., 879 F.2d 1154

Gee aes cbececovcecsocccce 5

United States v. Dianovin Pharm., Inc.,

Io co eccceecccncescess 3

United States v. Sene X Eleemosynary Corp.,

479 F. Supp. 970 (S.D. Fla. 1979), aff'd,

[1982-1983 Transfer Binder] Food Drug

Cosm. L. Rep. (CCH) 4 38,207 (11th Cir.

ede ccc ceecccececocescs 5

Virginia State Bd. of Pharmacy v.

Virginia Citizens Consumer Council,

iE cieecesacesccccececccccs 22-23

Warner-Lambert Co. v. Heckler, 787 F.2d 147

eee cc cecececcecccecs 4

1V

TABLE OF AUTHORITIES—Continued

Page(s)

Constitution and Statutes

See ES cunccccccedetennscctesodes passim

Be RED oc kcseccbendceedenscaveeneccusic 12

Bp es ED odode cccséesdcceceosesecscondess +

i 0 ror rrerrr rr TTT Tre errr 4

Be ae 6 Wt nad eens dbcccuadcnductedeees 12

ee ee ED Skunk dcuecidedesesddiecs denceuns 12

Be Ce REE ceccecustvcccecdosteccenetees passim

Bp es ED 6 0 bc cnc peccccoceceseddécuaceetss 9

ee ee EE 5.0 00s ccccccesseneddcsasesvacees 16

ep CO EEE eaecccnasvccassbaskeceewenes 16

Be ae ED nc avcewcccecdsécevenscsces 17

Be es ED vv devesadeds scccendscdsacseeds 17

Comprehensive Drug Abuse Prevention and

Control Act of 1970, Pub. L. No. 91-513,

Os GED oo ééccucccccccesecesaucseccesess 17

Drug Amendments of 1962, Pub. L. No. 87-781,

PD ED vec ncéedssecescuscceeveoscecs 3, 16-17

Federal Food and Drugs Act of 1906,

Pub. L. No. 59-384, 34 Stat. 768 .............. 7,13

v

TABLE OF AUTHORITIES—Continued

Federal Food, Drug, and Cosmetic Act of 1938,

Pub. L. No. 75-717, 52 Stat. 1040 ............

Food and Drug Administration Modernization Act

of 1997, Pub. L.No. 105-115, 111 Stat. 2296 ....

N.D. Admin. Code § 61-04-04-01(14).............

Miscellaneous

Abstract of the Proceedings of the House

of Delegates, APhA, 17 J. AM. PHARM.

SUPE Gd cndcecsesesessencacess

81 CONG. REC. 2001 (1937) ........... cece ween

83 CONG. REC. 2279 (app.) (1938) ............4..

DISPENSING OF MEDICATION (9th ed. 1984) ........

Emest, Pharmacists in the Civil Service,

1940 J. AM. PHARM. ASS’N 301 ..............

Fischelis, Golden Anniversary Address,

15 J. AM. PHARM. ASS’N 476 (1936) ..........

Fischelis, Federal Drug Legislation Must Not

Be Permitted to Die, 14 J. AM. PHARM.

FE SEED Woe cccaccscccesvccccceces

Page(s)

vi

TABLE OF AUTHORITIES—Continued

Page(s)

GUIDANCE FOR INDUSTRY: PROVIDING CLINICAL

EVIDENCE OF EFFECTIVENESS FOR HUMAN

DRUG AND BIOLOGICAL PRODUCTS (FDA 4

History and Background Information on USP 's

Activities in Compounding Pharmacy Practices,

27 PHARMACOPEIAL F. 3169 (2001) ............... 6

HUSA’S PHARMACEUTICAL DISPENSING (6th ed. 1966)... 15

Joint Session of the American Pharmaceutical

Association, the American Association of

Colleges of Pharmacy and the National

Association of Boards of Pharmacy,

17 J. AM. PHARM. ASS’N 1000 (1938) .......... 6, 13

Jurisprudence in the Pharmaceutical Curriculum,

1940 J. AM. PHARM. ASS’N 273 ..........0055: 13-14

Klumpp, The Philosophy of the Food, Drug and

Cosmetic Act, 1941 J. AM. PHARM. ASS’N 379 ..... 14

Memorandum for Ass’t Sec’y of the Army, Navy

& Air Force from Ass’t Sec’y of Defense re:

Tri-Service Pharmacy Policy Guidance

(Jul. 26, 1995), available at http://www.tricare.

osd.mil/policy/fy95/pharmpol.html .............. 19

NATIONAL ASS’N OF BDS. OF PHARMACY,

MODEL STATE PHARMACY ACT ..........-.-. 18, 20

DEetiemes PI 2 cc ccccccccccccccccsccccsscecs 12

National Survey of Quality Assurance Activities for

Pharmacy-Prepared Sterile Products in Hospitals,

48 AMER. J. OF HOSP. PHARM. 2398 (1991) ........ 21

vii

TABLE OF AUTHORITIES—Continued

Page(s)

O’CONNELL & PETTIT, A MANUAL OF

PHARMACEUTICAL LAW (1938) ..............00.. 7

PETTIT, MANUAL OF PHARMACEUTICAL LAW

Dt dchueiheuednn dbs iene éuwees< 14, 16

Pharmaceutical Care: Part of TQM?,

DRUG Topics 10 (July 10, 1995) ................ 21

Proceedings of the Local Branches,

14 J. AM. PHARM. ASS’N 232 (1935) .............. 6

REMINGTON’S PRACTICE OF PHARMACY

ES ERA Pa nee 6, 7

REMINGTON’S PRACTICE OF PHARMACY

DL EY dt nkdideaceecdecas busandeecéua 14-15

REMINGTON’S PRACTICE OF PHARMACY

PED i cietGl conenecnaeeceéoeutbus 6, 15

REMINGTON’S PHARMACEUTICAL SCIENCES

RR ME RNa eee eee Emm mee 15

Serre 19, 21

Schwartz, Pharmacy in the U.S. Navy,

1940 J. AM. PHARM. ASS’N 299 ................. 12

Smith, Training Army Pharmacy Technicians,

1940 J. AM. PHARM. ASS’N 296 ............... 11-12

Swain, Legislative Weather-Vanes,

| 15 J. AM. PHARM. ASS’N 794 (1936) ............ 8,9

THE PHARMACEUTICAL CURRICULUM (1952) .......... 16

Vili

TABLE OF AUTHORITIES—Continued

Page(s)

Underhill, Regulatory and Clinical Aspects

of the Resurgence of Compounding

by Pharmacists, 22 DRUG. DEV. &

INDUS. PHARMACY 659 (1996) .... 2... 2060s eens 19

U.S. Pharmacopoeia XII (1942) .......... Ay SUEY 12-13

VETERANS HEALTH ADMINISTRATION —

PHARMACY SERVICE, VA HANDBOOK 7610

(Jan. 11, 1990), available at http://www.va. gov/

facmgt/standard/space_idx.asp .......---++++ee5 19

INTEREST OF THE AMICUS CURIAE'

Amicus curiae the International Academy of Compounding

Pharmacists (“IACP”’) is an international non-profit association

devoted to the protection and advancement of pharmaceutical

compounding — one of the essential elements of the profession

of pharmacy. The I[ACP’s membership consists of more than

1400 pharmacists who engage in compounding, as well as

approximately 200 other members, including physicians,

patients, pharmacy students, and retired pharmacists. In

defending the constitutionality of the limitations on speech

relating to compounding, the government has asserted that the

“introduction of compounded new drugs into interstate com-

merce” (Pet. Br. 18) was “unlawful in all circumstances” prior

to 1997. According to the government, compounded drugs have

been subject to a “generally applicable prohibition on [their]

distribution” (id.) and “would be (and [are]) prohibited” (id. at

19) unless the statute at issue in this case is upheld. That

position, if accepted, would devastate LACP’s members in their

practice of pharmacy and in their ability to serve patients’

needs. The IACP thus has a critical interest in seeing that the

Court be given an accurate picture of the law and history of

pharmaceutical compounding. Moreover, [ACP members

regularly advertise. They thus have a strong interest in not

being subjected to the unconstitutional limits on their speech

imposed by the statute at issue in this case.

SUMMARY OF ARGUMENT

The government’s defense of the limits on speech relating

to pharmaceutical compounding rests on the suggestion that

compounding was illegal from 1938, when the Federal Food,

Drug, and Cosmetic Act was enacted, until 1997, when the

statute at issue in this case was enacted. The government is

simply wrong. Far from being illegal for 59 years, pharmaceuti-

' Pursuant to this Court’s Rule 37.3, letters from the parties consenting to the

filing of this brief have been lodged with the Clerk of the Court. Counsel for

amicus curiae wrote this brief in its entirety. No person or entity, other than

the amicus curiae, its members, or its counsel, has made a monetary

contribution to the preparation or submission of this brief.

2

cal compounding has long been an essential part of the practice

of pharmacy — as ample historical evidence makes clear.

Because compounding has always been legal, the government

can have no interest, much less a substantial one, in saying that

it can be made legal only if coupled with a restriction on

advertising. The limits on speech concerning pharmaceutical

compounding are unconstitutional.

ARGUMENT

I. Introduction

Under Central Hudson Gas & Elec. Corp. v. Public Serv.

Comm'n, 447 U.S. 557 (1980), restrictions on commercial

speech pass muster under the First Amendment if, and only if,

the governmental interests underlying the restriction are

“substantial”; the speech limitation “directly advances the

governmental interest[s] asserted”; and the regulation is “not

more extensive than is necessary to serve [the] interest[s].” Jd.

at 566; see Pet. App. 4a-Sa. In arguing that Section 503A of the

Federal Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. §

353a,’ is constitutional, the government says that the statute

directly advances several interests “substantial” enough under

Central Hudson: “preserv[ing] the effectiveness and integrity

of the FDCA’s new drug approval process” (Pet. Br. 19);

“preserv[ing] the availability of compounded drugs” (id.); and

“{a]chieving the proper balance between these two independ-

ently compelling but competing interests” (id. at 20).

But Central Hudson protects speech concerning only

“lawful activity” (447 U.S. at 553), and here the government

says that accurate advertising concerning compounded drugs

relates to an activity that is “lawful” only because Congress has

created a “carefully circumscribed exemption.” Pet. Br. 18. In

? Section 503A of the Federal Food, Drug, and Cosmetic Act of 1938

(“FDCA”), Pub. L. No. 75-717, 52 Stat. 1040, was added by the Food and

Drug Administration Modernization Act of 1997 (“FDAMA”) Pub. L. No.

105-115, 111 Stat. 2296.

3

contrast, the government says, “[b]efore 1997,” when FDAMA

was signed into law, “the introduction of compounded new

drugs into interstate commerce * * * was unlawful in all

circumstances.” Jd. This means that but for the speech restric-

tions at issue in this case compounding “would be (and is)

prohibited” (id. at 19); see also id. at 6 (maintaining that

“[{i}ntroduction of compounded drugs into interstate commerce

without the approval of the FDA was thus illegal before

enactment of FDAMA * * * and it remains illegal today unless

the requirements in Section [503A] are satisfied”) (citation

omitted).

The implications of the government’s view are breathtak-

ing. The FDA has consistently taken the position that if drug

components have moved through interstate commerce, the

agency has jurisdiction over the product. See, e.g., United

States v. Dianovin Pharm., Inc., 475 F.2d 100, 102-03 (1st Cir.

1973). At least one component of every compounded drug is

invariably shipped in interstate commerce. Thus, under the

government’s theory, a// extemporaneously compounded drugs

would need to go through the rigorous new drug application

(“NDA”) process in order to be dispensed. The government’s

argument — if adopted — would effectively render all compound-

ing without an NDA illegal, éven if the product is dispensed

intrastate.

But compounded drugs cannot comply with the NDA

requirements. As enacted in 1938, the FDCA mandated that the

sponsor of a “new drug” submit, among other things, “full

reports of investigations which have been made to show

whether or not such drug is safe for use.” Pub. L. No. 75-717;

FDCA § 505(b). (The Drug Amendments of 1962, Pub. L. No.

87-781, 76 Stat. 780 (the “1962 Amendments”) added the

requirement that sponsors of new drugs demonstrate the efficacy

of the drug as well.) Extemporaneously compounded drugs are

4

compounded drugs intended for use in a single patient, but

conducting “investigations” with a single patient is impossible.’

Even if a pharmacist received several prescriptions for the

same compounded drug, she could not possibly conduct clinical

studies, submit the NDA, and await FDA approval in time to

provide treatment for the patients. Furthermore, as the govern-

ment notes, a separate FDA approval would be needed any time

a physician’s prescription called for even the slightest variation

in the compounded drug, such as a different dose or route of

administration. Pet. Br. 26. The preclusive effect of the NDA

requirement is not merely a question of cost, as the government

asserts, id., but of the impossibility of conducting clinical

studies and allowing the patient to receive promptly the medica-

tions prescribed by the physician. Even more astonishing, if the

government is right that FDA approval is required for all

compounded drugs, then on every occasion since 1938 that a

pharmacist extemporaneously compounded a drug for a patient,

the pharmacist was acting in violation of the FDCA — a statute

that makes it a crime to violate the “new drug” provisions.

FDCA § 301(d), 21 U.S.C. § 331(d); see FDCA § 303(a)

(providing for imprisonment and/or fines for violations of

§ 301), 21 U.S.C. § 333(a).

The government, however, is wrong. Contrary to the

government’s suggestion that compounding was illegal until

FDAMA created a limited “exemption” that allowed it, com-

pounding is, and always has been, an essential and lawful part

of the practice of pharmacy. In a rewriting of history reminis-

cent of the position it took in Brown & Williamson v. FDA, 529

> FDA has repeatedly interpreted “investigations” to mean more than one

clinical trial. In a guidance document drafted pre-FDAMA regarding clinical

evidence of effectiveness (a requirement added in 1962), the agency asserted

that “Congress generally intended to require at least two adequate and well-

controlled studies * * * to establish effectiveness.” GUIDANCE FOR

INDUSTRY: PROVIDING CLINICAL EVIDENCE OF EFFECTIVENESS FOR HUMAN

DRUG AND BIOLOGICAL PRODUCTS 3 (FDA 1998) (citing Warner-Lambert

Co. v. Heckler, 787 F.2d 147 (3d Cir. 1986)).

PT i etl

5

U.S. 120 (2000), the government is asserting here that Congress

banned compounding in the FDCA in 1938, then decided to

permit itin FDAMA in 1997 subject to the limits on advertising.

In point of fact, only recently did the FDA claim for the first

time that agency approval of compounded drugs was required.*

As we explain below, the FDCA was not intended to, and

did not, give the federal government the authority to regulate,

much less ban, the practice of extemporaneous compounding.

Rather, like the practice of medicine, regulation of the practice

of pharmacy compounding was left by Congress to the states.

Considerable historical evidence demonstrates that the FDCA

was not intended to halt the practice of compounding; con-

versely, there is a complete lack of any historical or legislative

evidence supporting the position staked out by the government.

* The district court decisions in United States v. Sene X Eleemosynary Corp.,

479 F. Supp. 970 (S.D. Fla. 1979), aff'd, [1982-1983 Transfer Binder] Food

Drug Cosm. L. Rep. (CCH) 4 38,207 (11th Cir. Jan. 12, 1983), and Cedars

North Towers Pharmacy, Inc. v. United States, [1978-1979 Transfer Binder]

Food Drug Cosm. L. Rep. (CCH) 38,200 (S.D. Fla. Aug. 28, 1978), do not

support the government’s argument that courts have held that compounding

creates “new drugs.” Pet. Br. 5-6. Both of these decisions involved

“pharmacies” that were engaged in the wholesale manufacture of new drugs

rather than drugs that were extemporaneously compounded, for individual

patients. The circuit court decisions in United States v. Algon Chem. Inc.,

879 F.2d 1154 (3d Cir. 1989), and United States v. 9/1 Kg. Containers, 854

F.2d 173 (7th Cir. 1988), are similarly inapposite. Pet. Br. 5-6. Both

decisions involved the sale of bulk veterinary drugs, not extemporaneously

compounded drugs for individual human patients. Finally, the government’s

citation of Professionals & Patients for Customized Care v. Shalala, 56 F.3d

592, 593 n.3 (Sth Cir. 1995), for the proposition that compounding creates a

“new drug” is incorrect. Pet. Br. 5. The referenced footnote merely notes

that the FDCA does not expressly exempt pharmacies or compounded drugs

from the new drug, adulteration or misbranding provisions. The legality of

compounding was not squarely presented in that case, which involved a

challenge to an FDA Compliance Policy Guide on procedural grounds and

not the substantive interpretation of the FDCA as applied to compounding.

To the extent that the footnote suggests that compounding creates “new

drugs” under the FDCA, it is incorrect.

6

Il. Historical Evidence Belies the Government’s Suggestion

that Compounding Was Illegal Prior to FDAMA

A. Compounding Has Always Been an Accepted Part of the

Practice of Pharmacy

Remington's Practice of Pharmacy — often described as the

“Bible” of pharmacy practice, and relied on widely in colleges

of pharmacy both historically and today — stated in 1936 that

“[p]harmacy is the science which treats of medicinal substances.

It embraces not only a knowledge of medicines and the art of

preparing and dispensing them, but also their identification,

selection, preservation, combination, analysis and standardiza-

tion* * * . Compounding consists of the skilful blending of two

or more ingredients.”” REMINGTON’S PRACTICE OF PHARMACY 1

(8th ed. 1936) (emphasis in original). Compounding has been

part of the practice of pharmacy since its inception. An

Egyptian papyrus scroll dating from the 16th century B.C.

discussed the compounding of medicines. /d. at 3-4. In this

country, John Winthrop, Jr. (1606-1676), son of the first

governor of Massachusetts, was one of the first Americans to

practice pharmaceutical compounding. REMINGTON’S PRAC-

TICE OF PHARMACY 13 (12th ed. 1961). The United States

Pharmacopoeia — an official compendium of drug information

recegnized as authoritative by the FDCA — has included

instructions on compounding medications since 1820. History

and Background Information on USP ’'s Activities in Compound-

ing Pharmacy Practices, 27 PHARMACOPEIAL F. 3169 (2001).

In 1938, when the FDCA was enacted, pharmacy com-

pounding was ubiquitous. Pharmacists compounded more than

250 million prescriptions annually. Proceedings of the Local

Branches, 14 J. AM. PHARM. ASS’N 232, 233 (1935). In

addition, the pharmacy laws of every state defined the practice

of pharmacy to include compounding. Joint Session of the

American Pharmaceutical Association, the American Associa-

tion of Colleges of Pharmacy and the National Association of

Boards of Pharmacy, 17 J. AM. PHARM. ASS’N 1000, 1010-13

(1938). For example, New York’s pharmacy act defined

7

“pharmacy” to mean a place in which “drugs, chemicals,

medications, prescriptions, or poisons are compounded.”

REMINGTON’S PRACTICE OF PHARMACY 1352 (8th ed. 1936);

see also O’CONNELL & PETTIT, A MANUAL OF PHARMACEUTI-

CAL LAW 159 (1938) (Pennsylvania law defined “pharmacy”

similarly). The New Jersey Board of Pharmacy promulgated

regulations providing that pharmacy interns were required to

compound personally at least 600 prescriptions during their

internship in order to be licensed. /d. at 23 n.1.

B. Pharmacists Supported the Passage of the FDCA

In the years immediately preceding the passage of the

FDCA, the American Pharmaceutical Association (“APhA”’),

the first professional association of pharmacists, strongly

supported passage of the FDCA. APhA supported the legisla-

tion because of concerns that manufactured proprietary and

patent medications were largely unregulated under the Federal

Food and Drugs Act of 1906, Pub. L. No. 59-384, 34 Stat. 768.

Pharmacists were apprehensive about the quality of manufac-

tured products, as well as the manufacturers’ advertising

practices. In a 1936 article, Robert P. Fischelis, the President of

APhA, remarked:

We see the actual compounding of medicines taken over by

large manufacturing units and the reduction of the average

retail pharmacist to a dispenser of ready-made medicines.

Without adequate control over advertising and production

of their remedies, the public is being educated by manufac-

turers to medicate itself, and the use of possibly harmful

drugs, without medical or pharmacal [sic] advice, is being

encouraged to the point where public health demands some

type of supervision. Passage of a revised Federal Food and

Drug Law giving the U.S. Food and Drug Administration

control over advertising [of manufactured drugs], requiring

the disclosure of the formulae of proprietary remedies and

strengthening the public control over the drug industry, is

essential to the public welfare and should be forthcoming

at this session of Congress.

Golden Anniversary Address, 15 J. AM. PHARM. ASS’N 476, 476

(1936). In a 1935 editorial, Fischelis wrote:

It is difficult to understand why [opponents of the FDCA],

whose chief interest in food and drug legislation is to block

efforts to compel truthful labeling and advertising of foods

and drugs and to ease the path of fakers in the food and

drug industries, should be in a position to thwart the efforts

of earnest legislators and respectable citizens in providing

proper control of the manufacture and distribution of drug

products.

Federal Drug Legislation Must Not Be Permitted to Die, 14

J. AM. PHARM. ASS’N 349, 349 (1935). From the pharmacists’

perspective, passage of the FDCA was necessary to control

manufacturers.

It seemed monstrous to us that the retail pharmacist must

meet a high educational standard, must satisfy exacting

State Board requirements and must subject himself to

almost continuous regulation and control, while the manu-

facturer, even though his products are much more wide-

spread in distribution, is required by law to meet no

standard whatsoever. In other words, while exacting

requirements were thrown around the man who would

compound a prescription for a dozen pills, there was no

such restriction surrounding the man who might produce

these same pills by the ton.

Swain, Legislative Weather-Vanes, 15 J. AM. PHARM. ASS’N

794, 796 (1936).

There is no historical evidence that pharmacists believed

that the FDCA encompassed extemporaneous pharmacy

compounding. Pharmacists were not alone. There is no

contemporaneous evidence that anyone — including the FDA —

9

thought the FDCA would prohibit pharmacy compounding, one

of the basic forms of health care in the United States.

C. The Legislative History of the FDCA Demonstrates the

Acceptance of the Practice of Compounding

Little was stated in the legislative history of the FDCA

about the meaning of section 505(a), 21 U.S.C. § 355(a), which

prohibited “new drugs” from being introduced into interstate

commerce unless they have been approved by the federal

government. However, the legislative history does suggest that

section 505 was intended to apply solely to manufacturers of

new drugs, and was not designed to affect the actions of

physicians and pharmacists in fulfilling their professional

responsibilities. In fact, physicians, as well as pharmacists, were

permitted to compound medicines as part of their practice:

“About the only real privilege granted to pharmacists under the

pharmacy laws was that of compuinding physicians’ prescrip-

tions, and this was no exclusive privilege as the pharmacist

3 this right with the physician himself.” Swain, supra, at

The subject of pharmacists arose in the debate on S. 5, the

bill that became the FDCA, prior to the addition of section 505.

The discussion did not directly address drug compounding by

pharmacists, but centered on a provision which stated that “No

drug defined in an official compendium shall be deemed to be

adulterated * * * because it differs from the standard of

strength, quality, or purity therefor set forth in an official

compendium, if its standard of strength, quality, or purity be

plainly stated on its label.” 81 CONG. REC. 2001, 2014 (1937).

Senator Copeland observed that if a physician in New

Jersey wanted to prescribe Fowler’s solution of arsenic in the

* Physicians continue to compound. See, e.g., Ark. Code Ann. § 17-92-102

(authorizing physicians to compound their own prescriptions). Although

; and ; lysis. all hysici ,

Gndsienb@ncen. : aa

10

standard strength, he simply had to write “Fowler’s solution,

U.S.P.” on the prescription, and he “may depend upon the

ethical standards of the pharmacist filling that prescription that

when it is filled it will be * * * ‘Fowler’s solution, U.S.P.”” Jd.

at 2017. Senator Moore responded:

That may * * * be true enough. He might also write that on

his prescription, and he might also tell the druggist how he

wishes him to prepare it. However, that does not alter the

fact that the bill provides that no drug below the standard

represented by the pharmacopoeia and the other standards

is adulterated if on the container the adulteration is made

manifest.

Id. This exchange exemplified an awareness that physicians

relied on pharmacists to “prepare,” i.e., compound, drugs for

their patients in accordance with instructions set forth in

prescriptions. Such preparation included the compounding of

drugs.

That section 505 was targeted toward drug manufacturers,

and not physicians and pharmacists, is emphasized in remarks

by Representative Coffee which appeared in the June 1, 1938

Congressional Record. Representative Coffee argued that S. 5

offered inadequate protection against the type of tragedy that

had occurred with the marketing of a new and untested drug,

elixir of sulfanilamide, in 1937. 83 CONG. REC. 2279 (app.)

(1938). He commented that at the time of the tragedy, Secretary

of Agriculture Henry Wallace “made excellent recommenda-

tions as to the minimum requirements of legislation which

should be enacted to prevent the public thus becoming prey of

criminally careless or ignorant manufacturers.” Id. (emphasis

added).

In Representative Coffee’s view, the proposed section 505,

which required the “licensing” of new drugs, failed to incorpo-

rate all the provisions believed by Secretary Wallace to be

essential. Summarizing Secretary Wallace’s and his own

concerns, Representative Coffee said:

ll

Secretary Wallace stated the case for licensing the manu-

facturers of potentially harmful drugs briefly and well: “In

the interest of safety, society had required that physicians

be licensed to practice the healing art. Pharmacists are

licensed to compound and dispense drugs. Electricians,

plumbers, and steam engineers pursue their respective

trades under license. But there is no such control to prevent

incompetent drug manufacturers from marketing any kind

of lethal poison.”

Id. (emphases added). Thus, section 505 of the FDCA was not

intended to affect the professional activities of physicians or

pharmacists, including their practice of compounding, but to

control drug manufacturers. There is no indication whatsoever

that Congress intended to ban compounding, which played an

irreplaceable role in the health care system. If compounding

had been banned in 1938, as the government argues more than

sixty years later, the results would have been catastrophic, since

there were, in many cases, no alternatives to compounded

medications. In 1938, the practice of medicine without com-

pounding was inconceivable.

D. The Actions of the Federal Government and Members of

the Pharmacy Profession, As Well As Official Compendia,

Make Clear That Compounding Was Not Regulated by the

FDCA

Considerable historical evidence from the period immedi-

ately following the enactment of the FDCA rebuts the govern-

ment’s contention that the statute banned extemporaneous

compounding by pharmacists. For example, in a series of

articles by United States military and civil service pharmacists,

the federal government recognized the importance of com-

pounding as part of the practice of pharmacy in the armed forces

and the civil service. See Smith, Training Army Pharmacy

Technicians, 1940 J. AM. PHARM. ASS’N 296, 297 (“The

pharmacy technician has five chief functions * * * (3) routine

dispensing and compounding of medications for wards and

clinics of the hospital; (4) compounding of prescriptions for

12

hospital and out-patients * * * .”); Schwartz, Pharmacy in the

U.S. Navy, 1940 J. AM. PHARM. ASS’N 299, 299 (“Every naval

unit to which a medical officer is attached has a fully equipped

pharmacy. It has * * * all the paraphernalia required in com-

pounding and dispensing medicine.”); Ernest, Pharmacists in

the Civil Service, 1940 J. AM. PHARM. ASS’N 301, 301 (“Where

drugs or medicines are dispensed or doctors’ prescriptions are

compounded, a duly qualified registered pharmacist is found to

be employed.”). There is no indication in these discussions that

compounding results in a new drug that must be approved by

FDA, or that federal employees were being advised to break the

law. Rather, compounding is discussed in the articles by federal

government officials as an accepted part of the practice of

pharmacy, rather than, as now asserted by the government, a

crime.

Moreover, both the United States Pharmacopoeia (“USP”)

and the National Formulary (“NF”) recognized the practice of

compounding and included instructions for compounding

numerous drugs as part of their compendial standards. See, e.g.,

U.S.P. XII, at 364-65 (1942) (instructions for compounding pills

of ferrous carbonate); id. at 446-48 (suppositories); id. at 505-06

(tinctures); id. at 532-41 (ointments); N.F. VII, at 400-01 (1942)

(syrups); id. at 439-40 (tinctures); id. at 469-77 (ointments).

The inclusion of compounding formulas in the USP and NF

is strong evidence that compounding was widely recognized as

legal. Congress identified both the USP and NF as “official

compendia” inthe FDCA. FDCA § 201(j); 21 U.S.C. § 321(j).

Any product or compounded preparation listed in a monograph

in the USP or the NF must therefore comply with the compendi-

al standards or they are deemed adulterated and misbranded.

FDCA §§ 501(b) (adulteration), 502(g) (misbranding), 21

U.S.C. §§ 351(b), 352(g). These compendia are the only

statutorily recognized compendia in the FDCA. Indeed, the

importance of the USP was such that numerous federal govern-

ment health officials, including representatives from the FDA,

the medical departments of the Army and Navy, the U.S. Public

13

Health Service, and the Department of Commerce, were

delegates to the U.S. Pharmacopeial Convention of 1940.

U.S.P. XII, at lix. Just two years after the enactment of the

FDCA, this USP Convention adopted monographs for many

compounded drugs.

Similarly, the pharmacy profession clearly understood that

the FDCA did not ban compounding. First, APhA celebrated

the enactment of the FDCA, stating in a 1938 article that:

It is gratifying to be able to note the enactment of the new

Food, Drug and Cosmetic Legislation by the Federal

government, to supplant the outmoded statute of 1906

*** We believe, despite the opposition encountered, that

a greatly improved piece of legislation has been enacted,

and that it is going to bring about a more wholesome

condition in the field of manufactured medicinal products.

Abstract of the Proceedings of the House of Delegates, APhA,

17 J. AM. PHARM. ASS’N 1052, 1055 (1938). Second, following

the passage of the FDCA, APhA supported state pharmacy

legislation to complement the federal act. APhA proposed

model legislation that stated that the “term ‘pharmacy’ * * *

shall be held to mean and include every store or shop or other

place * * * where physicians’ prescriptions are compounded

***.” Joint Session of the American Pharmaceutical Associa-

tion, supra, 17 J. AM. PHARM. ASS’N at 1013. Under the

government’s novel theory, this legislation defined pharmacy in

terms of an illegal act. Further, in an article entitled Jurispru-

dence in the Pharmaceutical Curriculum, an officer of the

APhA noted that:

Everyone with any familiarity at all with the field knows

that, while the Federal Food, Drug and Cosmetic Act has

only an indirect relation to the pharmacist engaged in the

operation of a retail drug store within a given area of any

given state, also knows that this same pharmacist is held to

a strict observance of another federal law; namely, the

Harrison Narcotic Act [predecessor to the Controlled

14

Substances Act, see infra at 17.]. The mere fact that one

act of Congress imposes a heavy burden upon the pharma-

cist, while another Congressional act is only of incidental

importance to him, should, at least, stimulate his curiosity.

1940 J. AM. PHARM. ASS’N 273, 273 (emphases added).

Just as there is no evidence that pharmacists believed that

one of their primary functions had been outlawed by the FDCA,

there is no evidence that FDA ever asserted that the FDCA

regulated compounded drugs as new drugs. Indeed, in an article

in the APhA Journal addressed to pharmacists, a former senior

FDA drug official discussed the “new drug” provision of the

FDCA without any mention that it affected the practice of

compounding. See Klumpp, The Philosophy of the Food, Drug

and Cosmetic Act, 1941 J. AM. PHARM. ASS’N 379, 381 (written

by the former Chief of the Drug Division of the FDA).

E. Post-Enactment Historical Evidence Supports the Proposi-

tion that Compounding Was Not Governed by the FDCA

The historical evidence from the years that followed the

enactment of the FDCA demonstrates that compounding

remained an integral part of health care. No one asserted that

compounding was made illegal by the FDCA, while every state

affirmatively authorized the compounding of drugs. “In

mentioning rights of pharmacists, state statutes generally list the

following as rights: to practice pharmacy, * * * to compound

prescriptions * * * .” PETTIT, MANUAL OF PHARMACEUTICAL

LAW 26 (3d ed. 1962). The 1951 edition of Remington's

Practice of Pharmacy included a discussion of the FDCA

without any mention of compounding being regulated under the

Act. It also noted that compounding was both permitted and

regulated by the states. REMINGTON’S PRACTICE OF PHARMACY

1163 (10th ed. 1951) (“The practice of pharmacy * * * is

regulated by law in every state. The police power, in the basic

governmental sense, is invoked to surround the compounding

and dispensing of prescriptions.”); id. at 1173-77 (discussion of

FDCA, no mention of compounding); id. at 1195-97 (discussion

ee eel

15

of minimum equipment needed for compounding and prescrip-

tion department); id. at 1220 (discussion of the prescription,

noting that the inscription section of the prescription “contains

the names and quantities of the ingredients” used to compound);

id. at 1227-28 (discussion of the filling and compounding of the

prescription); see also REMINGTON’S PRACTICE OF PHARMACY

1567 (12th ed. 1961) (inscription of prescription contains

“names and quantities of the prescribed ingredients”); id. at 1571

(discussion of the compounding of the prescription); id. at 1697

(stating that “[t)he regulation of the practice of pharmacy is a

function of the states, and not of the Federal Government”’); id.

at 1706-10 (analysis of FDCA, no mention of compounding). A

later edition of Remington's made the same point quite plainly:

“The regulation of the practice of pharmacy is a function of the

states, and not of the Federal Government.” REMINGTON’S

PHARMACEUTICAL SCIENCES 1963 (14th ed. 1970); see id. at

1976-85 (treatment of FDCA, no mention of compounding).

Other pharmacy texts similarly referred to drug compound-

ing as a universally accepted practice regulated by the states.

For example, the preface to Husa 's Pharmaceutical Dispensing

— another important pharmacy treatise dealing almost exclusively

with compounding — states that “[c]ompounding of medicinal

products will always be an important function of the pharmacist

in spite of the fact that practically all prescriptions now call for

prefabricated medication.” HUSA’S PHARMACEUTICAL DISPENS-

ING 36-42 (6th ed. 1966) (discussion of federal and state laws

regarding pharmacy; noting that regulation of practice of

pharmacy, including “licensure and standards for compounding

and dispensing of prescriptions, is embodied in the laws of the

various states”). More recent pharmaceutical texts have also

discussed the importance of compounding, without noting any

federal regulation of the practice. See DISPENSING OF MEDICA-

TION ch. 12 (9th ed. 1984) (chapter on extemporaneously

compounded formulations). The authors of the chapter entitled

“Extemporaneous formulations” stated that “[t]he purpose of

prescription compounding is to dispense safe, effective medica-

tion pursuant to the order of a duly licensed practitioner whose

16

judgment has dictated that individualized drug therapy is

required for a patient.” /d. at 258. The premise underlying this

book is that compounding is legal.

While the authors of these widely utilized pharmacy texts

clearly understood the importance of the FDCA in regulating the

manufacture of drugs, no author even suggested that the FDCA

rendered compounded drugs illegal unless approved by the

federal government. Indeed, the various treatises from the

period are uniform in recognizing that state governments —

through the state legislatures and state boards of pharmacy -

both permitted and regulated compounding.

The government’s theory is further belied by the fact that

pharmacy students took classes in compounding. For example,

a report prepared by the American Association of Colleges of

Pharmacy discussed the importance of pharmaceutical com-

pounding as part of the pharmaceutical curriculum. See THE

PHARMACEUTICAL CURRICULUM 144-45, 148-49 (1952)

(discussing the centrality of compounding courses in colleges of

pharmacy). Many states also required practical experience in

compounding and dispensing prescriptions prior to licensure.

PETTIT, MANUAL OF PHARMACEUTICAL LAW 25-26 (3d ed.

1962). For example, the California Board of Pharmacy required

950 hours of practical experience in the compounding and

dispensing of prescriptions. /d. at 26. The government’s novel

contention is that colleges of pharmacy throughout the country

were teaching their students about an illegal practice, and that

the states were requiring pharmacists to display proficiency in an

illegal act to be licensed.

The 1962 Amendments further demonstrate that extempora-

neous compounding by pharmacists was not precluded by the

FDCA. The 1962 Amendments added provisions to the FDCA,

among other things, requiring manufacturers to register with the

FDA and list their drugs. See FDCA § 510(b), 21 U.S.C.

§ 360(b). Pharmacies were (and siill are) exempt from these

requirements. See FDCA § 510(g)(1) (exempting pharmacies

from registration and listing), 21 U.S.C. § 360(g)(1). Pharmacies

17

were also subject to more limited inspections than manufactur-

ers. FDCA § 704(a)(2)(A), 21 U.S.C. § 374(a)(2)(A). It would

make no sense to exempt pharmacies from the relatively trivial

paperwork requirements of filing registration and listing forms,

were it necessary to comply with the onerous requirements of

demonstrating safety and effectiveness of each compounded

drug in an NDA. The government’s illogical theory is that the

1962 Amendments required pharmacists to prove efficacy

through controlled clinical studies for every compounded drug,

an impossible task for a drug administered to a single patient, but

were exempt from the ministerial task of filing a one-page form

to list the drug.

Additional evidence that Congress did not intend the FDCA

to govern pharmacy compounding is found in the Comprehen-

sive Drug Abuse Prevention and Control Act of 1970, Pub. L.

No. 91-513, 84 Stat. 1236 (“CSA”). In the CSA, Congress

defined the term “manufacture” to exclude:

the preparation, compounding, packaging, or iabeling of a

drug or other substance in conformity with applicable State

or local law by a practitioner as an incident to his adminis-

tration or dispensing of such drug or substance in the course

of his professional practice.

CSA § 102(14), 21 U.S.C. § 802(15). Although there is little

discussion of this exemption in the legislative history, it is

- implausible that Congress would have exempted compounding

from regulation under the CSA if the act of compounding

without an NDA were illegal under the FDCA. On the contrary,

the only explanation is that Congress, in permitting the com-

pounding of controlled substances, did not believe that the

FDCA had already banned extemporaneous compounding.

F. In the Years Immediately Prior to Enactment of F DAMA,

Compounding Was Widely Recognized as Legal

In the years prior to the enactment of FDAMA, two promi-

nent organizations — both of which were given a role by Con-

gress in the regulation of compounding — adopted standards

18

regulating compounding. By establishing standards for com-

pounding, these organizations both affirmed the legality of

compounding. In 1993, the National Association of Boards of

Pharmacy (“NABP”) — the professional organization whose

members are the state boards of pharmacy — adopted Good

Compounding Practices as part of their Model State Pharma: y

Act. See NABP MODEL STATE PHARMACY ACT app. C.1 (Good

Compounding Practices Applicable to State Licensed Pharma-

cies). These guidelines, adopted in whole or in part by numerous

states, set forth minimum standards for the practice of com-

pounding. The standards include detailed instructions regarding

equipment, adequate space for compounding, the training and

qualifications of personnel involved in compounding, storage of

raw materials, and drug compounding controls. In 1996, USP -

one of the two official compendia mentioned in the FDCA -

“stated that “[c]ompounding is an integral part of pharmacy

practice and is essential to the provision of health care.”

USP/NF Supplements 3531 (1996). At that time, USP adopted

a monograph setting forth standards for compounding. See id.

(Chapter <1161> Pharmacy Compounding Practices). The

monograph includes standards regarding equipment, facilities,

ingredient sources, stability criteria, acceptable compounded

dosage forms, record retention, and quality control. Neither the

NABP’s Good Compounding Practices nor the USP’s mono-

graph states that NDAs are required for compounded drugs.

Thus, the two standard-setting organizations identified by

Congress in section 503A of FDAMA, 21 U.S.C. § 353a,

established compounding guidelines before 503A was enacted.

These actions further controvert the government’s claim that

prior to FDAMA, all compounding resulted in the creation of an

illegal new drug.®

® Significantly, both USP and NABP were giv-n roles to play regarding

compounding under FDAMA. Congress direc’ 2d the Secretary of Health and

Human Services to consult with NABP in developing a memorandum of

understanding for use with the states in the interstate distribution

of compounded drugs. FDCA § 503A(b)(3\B), 21 U.S.C. § 353a(b\(3)(B).

19

At the same time these standards were developed, even

agencies of the federal government continued to promote the

practice of compounding. For example, the Department of

Defense stated in its policy on pharmacies at military treatment

facilities that “(t]he pharmacy may bulk compound pharmaceuti-

cal preparations using formulas from official compendiums,

other references, or a locally developed formula.” Memorandum

for Ass’t Secretaries of the Army, Navy & Air Force from Ass’t

Sec’y of Defense re: Tri-Service Pharmacy Policy Guidance (Jul.

26, 1995), available at http://www.tricare.osd.mil/policy/fy95/

pharmpol.html. The Veterans Health Administration (“VHA”)

similarly required all VHA pharmacies to set aside sufficient

space for extemporaneous compounding. VETERANS HEALTH

ADMINISTRATION — PHARMACY SERVICE, VA HANDBOOK 7610,

ch. 268, at 268-4 (Jan. 11, 1990), available at http://www.va.

- gov/facmgt/ standard/space_idx.asp.

Moreover, in the years leading up to FDAMA, state

legislatures continued to authorize compounding. Congress

recognized this fact in the legislative history to FDAMA, stating

that “[a}ll States include[{d] compounding as a core component

of the profession of pharmacy.” S. REP. NO. 105-43, at 67 ©

(1997); see also Underhill, Regulatory and Clinical Aspects of

the Resurgence of Compounding by Pharmacists, 22 DRUG. DEV.

& INDUS. PHARMACY 659, 660 (1996) (“Traditionally, com-

pounding by pharmacists of a prescription * * * for a patient has

been under the control of the relevant State Board of Pharmacy

and in fact 41 of the 50 state laws which define the practice of

pharmacy specifically including [sic] ‘compounding’ per se in

their definition”). The government’s assertion about the

illegality of compounding would nullify the pharmacy laws of all

50 states, for each state explicitly authorized compounding.

Indeed, not only did all state legislatures authorize pharmacy

compounding, but several state boards of pharmacy also defined

Representatives from NABP and USP were to participate in an advisory

committee prior to the issuance of ions implementing section 503A.

FDCA § 503A(d), 21 U.S.C. § 353a(d).

20

“unprofessional conduct of a pharmacist” to include refusing to

compound prescriptions.’ Refusing to compound prescriptions

can therefore result in professional discipline by states that

require pharmacists to compound.

In the years preceding the enactment of FDAMA, com-

pounding pharmacies differed to an extent in their practices.

Most pharmacies engaged in limited extemporaneous compound-

ing to meet the needs of local patients. Other pharmacies began

to specialize, and fill prescriptions from a more geographically

diverse area. With the growing importance of intravenous

admixtures, hospital pharmacies performed increasing amounts

of compounding. Regardless of their setting or the geographic

area served by these pharmacies, they shared common traits:

licensure by state boards of pharmacy, compounding prescrip-

tions pursuant to state legislation explicitly authorizing the

practice, and dispensing medications to their patients to fill

prescriptions by physicians. They also shared another trait —

under the government’s contention, all of their compounding

was illegal.

Immediately preceding the enactment of FDAMA, standard-

setting organizations, federal government agencies and the state

boards of pharmacy all permitted compounding when performed

in compliance with state regulation. Under the government's

revisionist approach, the Department of Defense, the Veterans

Health Administration, the state legislatures, the state boards of

pharmacy, the U.S. Pharmacopoeia, and the National Associa-

tion of Boards of Pharmacy were all advocating that pharmacists

commit criminal acts.

” Mass. Regs. Code tit. 247, § 9.01(16); N.D. Admin. Code § 61-04-04-

01(14); Minn. R. 6800.2250; see also NABP MODEL STATE PHARMACY ACT,

MODEL RULES FOR PHARMACEUTICAL CARE § 5(2) (“Unprofessional conduct

shall include * * * [u}mreasonably refusing to Compound or Dispense

Prescription Drug Orders that may be expected to be Compounded or

Dispensed in Pharmacies by Pharmacists.”). .

21

In sum, the government’s claim that compounding was

illegal prior to the enactment of FDAMA turns history on its

head. Between 1938 and 1997, pharmacists dispensed billions

of compounded. In 1995, pharmacists compounded approxi-

mately 220 million prescriptions. Pharmaceutical Care: Part of

TQM?, DRUG ToPICs 10 (July 10, 1995). Over 96% of hospitals

surveyed by the American Society of Hospital Pharmacists in

1991 engaged in extemporaneous compounding of sterile drug

products. National Survey of Quality Assurance Activities for

Pharmacy-Prepared Sterile Products in Hospitals, 48 AMER. J.

OF HosP. PHARM. 2398, 2401 (1991). Under the government’s

theory, each drug that was dispensed represented a criminal act.

Because compounded prescription drugs cannot be dispensed

without a prescription, each of these violations was facilitated by

a physician or other authorized prescriber. Aiding and abetting

these innumerable violations were the colleges of pharmacy that

taught the practice of compounding, the state legislatures that

authorized compounding, the state boards of pharmacy that

regulated compounding and required pharmacists to maintain

compounding equipment, the National Association of Boards of

Pharmacy and the USP and other compendia that set forth

compounding standards and compounding instructions. Con-

trary to the government’s assertion, Pet. Br. 25, these activities

did not occur because Congress had prohibited compounding in

1938 but FDA had silently exercised its enforcement discretion.

Rather, they occurred because Congress, in enacting the FDCA,

did not outlaw extemporaneous compounding.

G. The Legislative History of FDAMA Supports the Proposition

that Compounding Was Not Regulated by the FDCA

The legislative history of FDAMA itself shows Congress

recognized that compounding was a state-authorized and

regulated activity. A Senate Committee Report confirms that

“{s]tates currently have the authority to license pharmacists and

regulate pharmacies, including the scope of pharmacy practice.

All States include compounding as a core component of the

profession of pharmacy.” S. REP. No. 105-43, at 67. The fact

22

that Congress itself recognized that compounding was defined by

the states as a “core component” of the practice of pharmacy

further demonstrates that compounding was not banned by the

FDCA as the government asserts.

Ill. This Court’s Commercial Speech Doctrine Protects

Advertising for Legal Activities Such as Pharmacy

Compounding

In light of the overwhelming evidence demonstrating that

compounding has been legal all along, and not just since the

passage of FDAMA, the ban on advertising ce ‘ained in Section

503A cannot possibly satisfy Central Hudson, 447 U.S. at 566.

The government asserts that the limits on speech are needed

to “preserve the effectiveness and integrity of the FDCA’s new

drug approval process.” Pet. Br. 19; see id. at 33, 37-38. The

government posits that compounding pharmacies evade the

onerous NDA requirements of section 505(a) of the FDCA,

while engaging in the advertisement of new drugs and that this

is inequitable to manufacturers, which must comply with section

505(a). The government further speculates that this may

encourage others to evade the new drug requirements through

compounding rather than filing an NDA.

But compounded drugs are not subject to the NDA process

and never have been. Compounding pharmacies are not,

therefore, evading the requirements of the FDCA (or encourag-

ing others to do so by example), and a ban on advertising

compounded drugs cannot “directly advance,” or advance at all,

the government’s interest in NDAs.

The government further argues that Section 503A is

necessary lest physicians, spurred by compounding pharmacies’

advertisements, otherwise prescribe vast quantities of com-

pounded drugs, rather than commercially available pharmaceuti-

cal products. The Court has previously rejected similar argu-

ments. In Virginia State Bd. of Pharmacy v. Virginia Citizens

Consumer Council, 425 U.S. 748, 767 n.21 (1976), the Court

rejected arguments that advertisements of low drug prices could

23

lead to overconsumption, stating that “{b]y definition, the drugs

at issue here may be sold only on a physician’s prescription. We

do not assume * * * that simply because low prices will be freely

advertised, physicians will overprescribe, or that pharmacists

will ignore the prescription requirement.” Likewise, alerting

physicians to the availability of specific compounded products

will not lead to overprescribing by physicians since the com-

pounded drug will be prescribed only where a medical need

exists. The government’s argument that the advertising restric-

tion is necessary to preserve a “careful balance” between making

compounded drugs available and preventing too much com-

pounding is not directly advanced by the advertising restrictions

at issue.

Contrary to the government’s arguments, there is consider-

able value to allowing compounding pharmacies to inform the

public about which products they can compound. Many

pharmacies specialize in compounding certain types of products,

such as respiratory drugs or hormone replacement therapy, yet

under FDAMA, pharmacists are not even allowed to advertise

the class of drugs that they can compound. If a pharmacist

cannot inform a physician of the types of drugs that he is capable

of compounding, the physician will not be aware of what options

may be available. While manufactured drugs are usually

appropriate today, they do not always meet a patient’s needs.

Compounding is particularly useful for patients who are allergic

to dyes, flavors or other excipients. Additionally, compounding

is often used to create pain medications for patients who cannot

swallow pills, or for patients for whom the standard dosage

forms are inappropriate.* According to the government, the only

appropriate advertisement under FDAMA is that a pharmacy is

capable of compounding. This bare assertion of capability does

not inform the physician of the types of drugs that a pharmacy

can tailor to meet an individual patient’s needs pursuant to a

physician’s instructions.

* Amicus Curiae American Pharmaceutical Association discusses this issue

at length.

24

CONCLUSION

The judgment of the court of appeals should be affirmed.

Respectfully submitted.

JEFFREY N. GIBBS

JENNIFER B. DAVIS

JEFFREY N. WASSERSTEIN

Hyman, Phelps & McNamara, PC

700 Thirteenth Street, N.W.

Suite 1200

Washington, D.C. 20005

(202) 737-5600

JANUARY 2002

ALAN E. UNTEREINER

ARNON D. SIEGEL*

Robbins, Russell, Englert,

Orseck & Untereiner LLP

1801 K Street, N.W.

Suite 41]

Washington, D.C. 20006

(202) 775-4500

* Counsel of Record