Obama DOJ to Biz: Drop First Amendment Claims or Else

The Department of Justice typically sets down certain terms of behavior for an individual seeking to settle a suit without going to trial. Usually, the requirements will include: Don’t step over that line again. And: Don’t associate with bad people. More severely, the government might say: Don’t engage in that profession again. But in a case settled this week, the DOJ required, as its price of settlement, that an individual drop a lawsuit seeking to vindicate free speech.

Consider that again. The U.S. government said to someone: Of course, we can’t prosecute you for claiming you have a right to free speech—but unless you drop your legal claim to free speech, we are going to prosecute you for something else. And the civil libertarians said nothing. Because the individual was a company.

Off-Label Discussions

The company in question was Allergan, the health-care company that makes the famous Botox Cosmetic but also its less famous pharmaceutical twin, Botox. In 2002, the FDA approved the former for cosmetic use, but as early as 1989 it had approved the latter for a limited number of muscle conditions, such as crossed eyes and spasms in the eye muscles. Nevertheless, it was widely known that Botox was also useful for several other purposes, such as the treatment of spasticity in the lower arm. And under FDA regulations, doctors were allowed to prescribe Botox for such “off-label” maladies. (Approximately 20 percent of all prescriptions in the United States are written for off-label purposes.) Soon, a number of these “off-label” uses of the medicine had become so general that Medicare and Medicaid accepted them as deserving of reimbursement.

Under the circumstances, Allergan thought it wise to sponsor meetings with doctors who might wish to use Botox in off-label ways. A principal purpose of the meetings was to inform doctors about the existence of certain safety issues. There is no suggestion that Allergan was putting out false or misleading information about Botox.

The Charge

On March 3, 2008, the DOJ launched an investigation of Allergan for holding these meetings to discuss off-label uses of Botox. And what was the basis for the investigation? It was a doctrine called “misbranding.” The term is a complete misnomer, because “misbranding” has nothing to do with deceit. Rather, a drug is called “misbranded” if its label does not contain directions for some “intended use.” Obviously, Botox labels did contain directions for the “intended uses” that had been approved by the FDA. But the FDA also allowed doctors to prescribe Botox for “off-label” uses, and directions for those uses could not legally be included on the label. So what was Allergan doing wrong?

According to the FDA, by meeting with doctors to inform them about some safety issues involved in “off-label” uses, those off-label uses had become “intended uses” of the manufacturer. And of course the label did not contain directions for them. Therefore, Botox was “misbranded.” Therefore, Allergan had committed a crime.

The terminology here exemplifies the Newspeak by which the government defames businesses. If you heard a TV announcer say that the government was prosecuting Allergan for misbranding Botox and for meeting with doctors to discuss off-label uses, you would probably think that the behavior in question was barely one step away from Allergan’s selling Lydia Pinkam’s Vegetable Compound. You probably would not realize that the government was prosecuting Allergan--criminally--for discussing some safety issues with doctors who were using its product in ways so thoroughly accepted that the government itself had approved reimbursement for them.

The Settlement

In settling with the DOJ, Allegran pled guilty to a misdemeanor and agreed to pay a fine of $375 million plus an additional $225 million to buy off some parasitical bounty-hunter suits. This $600 million punishment, remember, was for the sin of discussing safety issues involved in widely accepted off-label uses of an Allergan pharmaceutical.

But the punishment of innocuous behavior is not the most troubling aspect of this case. On October 1, 2009, Allergan initiated a lawsuit claiming a free-speech right to provide truthful and non-misleading information about off-label uses. Laurence Tribe of Harvard Law School was quoted as saying: "I think that Allergan has a strong First Amendment case for a right to market lawful but off-label uses for its drugs in a truthful and non-misleading way."

On October 8, 2009, James M. Beck and Mark Herrmann, of the group blog “Drug and Device Law,” provided this excellent, lengthy analysis suggesting Allergan could well win its case. The blog post included these fateful words: “One more thing – don’t forget that the Supreme Court has a big First Amendment case before it right now. Citizens United v. FEC. Some knowledgeable commentators think that that case could wind up being a ringing endorsement of the First Amendment rights of corporations generally. . . If that happens, it would likely strengthen the case for an injunction against the FDA even further.”

On January 21, 2010, the Supreme Court handed down its decision in Citizens United v. FEC, and it was an endorsement of the First Amendment rights of corporations. On January 27, 2010, President Obama used his State of the Union address to denounce the decision. Seven months later, a court case that might well have advanced the free speech of corporations yet further was dropped because of threats by Obama’s Justice Department.

There is a moral to the story. When Allergan launched its lawsuit, the company’s vice president for corporate communications, Caroline Van Hove, insisted that the company’s sole concern in defending its First Amendment rights was to make sure that physicians were properly educated about Botox. “We are not crusaders,” she said. Eleven months later, it has become clear that she spoke truly. And the consequence is? That Allergan, today, has neither the right it sought nor the ability it sought. Capital is a coward, they say. But that is no excuse for capitalists. If America is no longer the home of the brave, it cannot long be the land of the free.

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