U.S. Supreme Court Decision Shields Generic Drug Manufacturers

162017_132140396847214_292624_nIn its 5-4 decision filed on June 24, 2013, the Supreme Court of the United States (“Supreme Court”) held that personal injury claims against generic drug manufacturers under design-defect consumer protection state laws that turn on the adequacy of a drug’s warnings are pre-empted by federal law.

Under federal law (the Federal Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. Section 301, et seq.)), drug manufacturers are required to obtain FDA approval prior to marketing any brand-name or generic drug in interstate commerce. Once approved, a drug manufacturer is not permitted from making any changes to the “qualitative or quantitative formulation of the drug product, including active ingredients, or in the specifications provided in the approved application.” Manufacturers of generic drugs are also prohibited from making any unilateral changes to a drug’s label.

In the case it was deciding, the Supreme Court stated that the issue before it was whether the federal law pre-empts the New Hampshire design-defect state claim under which a plaintiff recovered damages from the defendant generic drug manufacturer of sulindac, a generic nonsteroidal anti-inflammatory drug (NSAID). The New Hampshire state law in question imposes a duty on manufacturers to ensure that the drugs they market are not unreasonably unsafe, and a drug’s safety is evaluated by reference to both its chemical properties and the adequacy of its warnings. Because the defendant generic drug manufacturer was unable to change sulindac’s composition as a matter of both federal law and basic chemistry, New Hampshire’s design-defect law effectively required the manufacturer to change sulindac’s labeling to provide stronger warnings, imposing a duty on the manufacturer to not comply with the federal law that prohibited it from independently changing the drug label, according to the Supreme Court’s majority opinion.

The Supreme Court held that under the Supremacy Clause, state laws that require a private party to violate federal law are pre-empted and, thus, are “without effect.” Therefore, the Supreme Court held that state-law design-defect claims that turn on the adequacy of a drug’s warnings are preempted by federal law (“we hold that state-law design-defect claims like New Hampshire’s that place a duty on manufacturers to render a drug safer by either altering its composition or altering its labeling are in conflict with federal laws that prohibit manufacturers from unilaterally altering drug composition or labeling”).

The Underlying Facts

In 1978, the FDA approved the brand-named drug Clinoril, a nonsteroidal antiinflammatory pain reliever (NSAID) generically called “sulindac.” When the patent for Clinoril expired, the FDA approved several generic sulindacs, including the one manufactured by the defendant generic drug manufacturer. In a very small number of patients, NSAIDs (including sulindac, ibuprofen, naproxen, and Cox2-inhibitors) have the serious side effect of causing two hypersensitivity skin reactions characterized by necrosis of the skin and of the mucous membranes: toxic epidermal necrolysis and Stevens-Johnson Syndrome.

In December 2004, the plaintiff was prescribed Clinoril for shoulder pain. She received a generic form of sulindac that was manufactured by the defendant. The plaintiff soon developed an acute case of toxic epidermal necrolysis that caused 60% to 65% of the surface of her body to deteriorate, burn off, or turn into an open wound. She spent months in a medically induced coma, underwent 12 eye surgeries, and was tube-fed for a year. She was permanently and severely disfigured, disabled, and is nearly blind as a result.

The plaintiff filed a civil action in the New Hampshire state court against the generic drug manufacturer, which the defendant removed to the federal court. A two-week trial was held on the plaintiff’s state-law design-defect claim after which the jury found against the defendant and awarded the plaintiff over $21 million in damages.

The Problem With The New Hampshire Law

New Hampshire requires manufacturers to ensure that the products they design, manufacture, and sell are not “unreasonably dangerous.” The New Hampshire Supreme Court has recognized that this duty can be satisfied either by changing a drug’s design or by changing its labeling. Since the defendant generic drug manufacturer did not have the option of changing sulindac’s design because of the FDCA, New Hampshire law ultimately required it to change sulindac’s labeling, according to the majority opinion of the Supreme Court.

The Supreme Court found that New Hampshire’s design-defect cause of action imposed a duty on the defendant to strengthen sulindac’s warnings. Because federal law prevents generic drug manufacturers from changing their labels, the Supreme Court stated that federal law prohibited the defendant from taking the remedial action required to avoid liability under New Hampshire law. The Supreme Court held that because it is impossible for the defendant and other similarly situated drug manufacturers to comply with both state and federal law, New Hampshire’s warning-based design-defect cause of action is pre-empted with respect to FDA-approved drugs sold in interstate commerce.

In one of the two dissents filed in the Supreme Court case, it was noted that “the FDA’s permission to market a drug has never been regarded as a final stamp of approval of the drug’s safety. Under the FDCA, manufacturers, who have greater “access to information about their drugs” than the FDA … retain the ultimate responsibility for the safety of the products they sell. In addition to their ongoing obligations to monitor a drug’s risks and to report adverse drug responses to the FDA … manufacturers may not sell a drug that is “deemed to be misbranded” because it is “dangerous to health” when used in the dosage or manner called for in the drug’s label.”

The dissent argues that imposing strict liability for injuries caused by a defective drug design might make a drug manufacturer want to change its label or design (or both) but does not mean the manufacturer was actually required by state law to take either action … exposure to liability, and the “incidental regulatory effects” that flow from that exposure … is not equivalent to a legal mandate for a regulated party to take (or refrain from taking) a specific action. This difference is a significant one: A mandate leaves no choice for a party that wishes to comply with the law, whereas an incentive may only influence a choice … The fact that imposing strict liability for injuries caused by a defective drug design might make a drug manufacturer want to change its label or design (or both) does not mean the manufacturer was actually required by state law to take either action. And absent such a legal obligation, the majority’s impossibility argument does not get off the ground, because there was no state requirement that it was physically impossible for [the defendant] to comply with while also following federal law.”

The dissenters stated, “A manufacturer of a drug that is unreasonably dangerous under New Hampshire law has multiple options: It can change the drug’s design or label in an effort to alter its risk-benefit profile, remove the drug from the market, or pay compensation as a cost of doing business. If federal law or the drug’s chemical properties take the redesign option off the table, then that does not mean the manufacturer suddenly has a legal obligation under state law to improve the drug’s label. Indeed, such a view of state law makes very little sense here because even if [the defendant] had strengthened its label to fully account for sulindac’s risks, the company might still have faced liability for having a defective design … When a manufacturer cannot change the label or when doing so would not make the drug safe, the manufacturer may still choose between exiting the market or continuing to sell while knowing it may have to pay compensation to consumers injured by its product … Here, no matter how many times the majority insists otherwise … a manufacturer who sells a drug whose design is found unreasonably dangerous based on a balance of factors has not violated a state law requiring it to change its label. In both cases, the manufacturer may owe money. But only in the former will it have failed to follow the law.”

The dissenters concluded: “Not all products can be made safe for sale with an improved warning or a tweak in design. New Hampshire, through its design-defect law, has made a judgment that some drugs that were initially approved for distribution turn out to be inherently and unreasonably dangerous and should therefore not be sold unless the manufacturer is willing to compensate injured consumers. Congressional intent to pre-empt such a cause of action cannot be gleaned from the existence of federal specifications that apply to the product if it is sold. Instead, whether New Hampshire’s design-defect cause-of-action is pre-empted depends on assessing whether it poses an obstacle to a federal policy to approve sulindac for use. Yet the majority skips that analysis and instead finds impossibility where it does not exist by relying on a question-begging assumption that Congress intended for [the defendant generic drug manufacturer] to have a way to continue selling sulindac without incurring common-law liability … As a result, the Court has left a seriously injured consumer without any remedy despite Congress’ explicit efforts to preserve state common-law liability.”


The Supreme Court’s decision in this case is another nail in the coffin of corporate responsibility. When consumers are unnecessarily harmed by using products in the manner in which they are marketed and intended, then the manufacturers of such products should be held responsible for the foreseeable harms suffered by the consumers.

If you or a family member have been injured due to a defective drug or defective medical product, you should promptly seek to consult with a local product liability lawyer in your state who may agree to investigate your bad drug (bad medical product) claim for you and represent you in a civil claim, if appropriate.

Click here to visit our website or telephone us toll-free at 800-295-3959 to be connected with medical malpractice lawyers in your state who handle defective drug claims (defective medical product claims) and who may be able to assist you with your claim.

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This entry was posted on Thursday, June 27th, 2013 at 9:14 am. Both comments and pings are currently closed.


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