ZANTAC MDL COURT RULES AGAINST PLAINTIFFS by John Ray

As the clock ran down on 2020, the Zantac/Ranitidine MDL Court handed down two rulings on defendant’s preemption motions (see copies of the Courts rulings at these links (link) (link). If these rulings stand, 80%-90% of potential Zantac/Ranitidine cases could ultimately face dismissal (if filed in the MDL).

The Court, in ruling for Defense on numerous matters raised, is allowing Plaintiff Leadership the opportunity to amend the various complaints on which Defense motions were based. Although the Court’s grant of leave to amend is a positive for Plaintiffs, firms not within the loop of Plaintiff Leadership face the uncertainty of knowing whether any amendments made, will change the Court’s current position. Therefore, filing certain Plaintiff cases in the MDL is a risk many firms no longer consider wise.

Fortunately, the MDL is not the only possible consolidated venue for your Zantac/Ranitidine cases. The remainder of this article will address efforts MTN is assisting in, to form State Consolidations, in venues where proper jurisdiction should exist for 80%-85% of the Plaintiff cases firms are likely to retain.
We will also discuss why we believe Plaintiffs will likely fare better in the State Consolidations, related to the preemption issues, which thus far have not gone well for Plaintiffs in the MDL.

We will start with a review of authorities relevant to the substance of this article. We will conclude with steps you can take now and in the near future, to protect your existing clients as well as factor into your decision to continue or discontinue marketing for these cases.

CITATION OF AUTHORITIES

The FFDCA comprehensively regulates the manufacture, importation, and sale of prescription drugs. Before a new drug may be introduced into interstate commerce, the FDA must approve the manufacturing process, labeling, and packaging. 21 U.S.C. § 355(b)(1). The approval process addresses the chemical composition of the drug, id. § 355(b)(1)(B), (C), the drug’s safety and effectiveness, id. § 355(b)(1)(A), and elements of the drug’s distribution, such as “the methods used in, and the facilities and controls used for, the manufacture, processing, and packing” of the drug, id. § 355(b)(1)(D), and the “labeling proposed to be used” for the drug. Id. § 355(b)(1)(F). The approval process is specific to each manufacturer and each product. See 21 C.F.R. § 314.50. In re Canadian Import Antitrust Litigation, 470 F. 3d 785 – Court of Appeals, 8th Circuit 2006 ID at 789

“No person shall introduce or deliver for introduction into interstate commerce any new drug” unless the drug is the subject of an approved application. [21 U.S.C. § 355(a)]

There are exceptions to 21 U.S.C. § 355(a)], which include OTC products subject to a Final OTC Monograph, Drugs Compounded by licensed pharmacy pursuant to a prescription from a licensed physician for a specific patient and repackaged products for use institutions, including unit dose packing. None of these exceptions apply to our current analysis.

The term “label” means a display of written, printed, or graphic matter upon any article or the immediate container (not including packaged liners) of any article; and the term “labeling” means all labels and other written, printed, or graphic matter (1) upon any article or any of its containers or wrappers, or (2) accompanying such article. 21 U.S. Code § 321(k) § 321 (m), 201(k) and 21 USC § 453(s).

ANDA applicants are required to submit (for approval), in electronic format, the content of labeling for the proposed drug (§ 314.94(a)(4)(ii) and (d). Once the FDA issues a final approval letter for an ANDA, no major changes to the labeling, including the labeling that appears on the outside the container, can be altered without prior approval from the FDA.

Assignment of an NDC number does not in any way denote FDA approval of the product. (21 CFR 207.37 (a)(2)).

The appearance on a drug product label of a person’s name, without qualification, is a representation that the named person is the sole manufacturer of the product. That representation is false and misleading, and the drug product is misbranded under section 502(a) of the act, if the person is not the manufacturer of the product in accordance with this section. 21 U.S. Code § 201.1 (h)(2)The term “counterfeit drug” means a drug which, or the container or labeling of which, without authorization, bears the trademark, trade name, or other identifying mark, imprint, or device, or any likeness thereof, of a drug manufacturer, processor, packer, or distributor other than the person or persons who, in fact, manufactured, processed, packed, or distributed such drug and which thereby falsely purports or is represented to be the product of, or to have been packed or distributed by, such other drug manufacturer, processor, packer, or distributor. 21 U.S. Code § 321 (g)(2).

Was Walgreens the sole manufacturer, the only entity involved in all acts required to enter the product below into the stream of commerce? Does Walgreens hold a single ANDA or NDA approval for a Ranitidine product? Were any of the Store Branded generic OTC products, manufactured solely by the retailer? Did any of these retailers hold a single NDA or ANDA approval for a Ranitidine product?

Both of the labels below were uploaded in two NDC code applications. Both listed ANDA 077824 as the FDA approval for the respective products. Anneal is the holder of this ANDA. Given the significant differences in these two labels and the fact that Aidarex is not the owner of ANDA 077824, how can Airadex legally market a product under the label below? Given the fact that the FDA delisted the NDC code for the Aidarex product, the answer seems to be Aidarex could not legally market their product as labeled. As labeled, the Aidarex product arguably needed to apply for a unique ANDA prior to marketing this product. The below is just one example of a significant number of entities that listed ANDA 077824, in their NDC applications, only to have the FDA delist the NDC codes, once the agency discovered the NDC code applicant was not the holder of the ANDA listed. It is important to note that it takes the FDA as long as three years, on average, to discover and deactivate the NDC codes for these products, and in many cases, the entity that had a given NDC code delisted, simply applied for another NDC code. Rinse and repeat.

RECALL vs NDC CODE DEACTIVATION

The MDL Court made mention of the fact that the FDA had not taken action against the various generic manufacturers relevant to claims made by Plaintiffs. Although the Court was not made aware of the significant number of actions the FDA has taken, to-date, against these defendants. These FDA actions would have been highly relevant to the Court’s considerations, had the Court been made aware.

It is important to note (regarding NDA and ANDA products), the FDA only recalls or recommends recall for products that have been approved by the FDA.
When the FDA discovers that NDC codes were obtained, (via the automated NDC code assignment system) for products that have not been approved by the FDA (unapproved drugs), The FDA deactivates the NDC codes associated with the given unapproved product.

A recall is not withdrawal of FDA approval, however; the FDA’s deactivation of an NDC code assigned to an unapproved drug product can only be interpreted as the agency’s determination that the product was never approved for entry into interstate commerce in the first instance.

When the various Master Complaints were filed in the Zantac/Ranitidine MDL, Plaintiffs’ Leadership had no reason to suspect that certain defendants (both named and unnamed) had apparently engaged in an ongoing conspiracy to enter counterfeit Ranitidine products into the stream of commerce. Plaintiffs’ Leadership had no reason to suspect that the FDA had discovered NDC codes had been assigned to a significant number of these unapproved drug products and then deactivated the NDC codes for these products. Furthermore, Plaintiffs’ Leadership had no reason to suspect that the conspiracy was so successful, that competition from legitimate products (approved products) was substantially eliminated. Having no reason to suspect any of the foregoing, these facts and evidence were not made known to the Court prior to the rulings on the various “Mensing” preemption motions. The defendants certainly possessed all this knowledge, however, obviously did not reveal to the Court and opposing parties these facts in their motions and arguments seeking preemption under Mensing.

The Court granted Plaintiff Leadership leave to amend the various complaints, allowing a short time frame for these amendments to be filed. Mass Tort Nexus (MTN) does not know whether Plaintiff Leadership will be able discover all the facts and evidence necessary, within the Court’s timeframe, to change the Court’s position relevant to the existing preemption rulings.

MTN spent over 9 months and several thousand hours researching and gathering evidence unraveling the apparent conspiracy, resulting in the following:

1. MTN has complied, what we believe to be, the only complete list of NDC codes ever assigned to a Ranitidine product. This task was particularly difficult because the FDA removes NDC codes from the public NDC code list, after the FDA has deactivated a code or the labeler has taken action to cause the given NDC code to be archived. This list will be vital for firms reviewing potential prescription use cases as without a complete list of Ranitidine NDC codes, upon review of pharmacy of insurance records, firms will incorrectly conclude that a potential client claiming to have been prescribed Ranitidine, were not.
2. MTN has compiled a list (with evidence) of all Ranitidine NDC codes deactivated by the FDA.
3. MTN has complied a list (with evidence) of all Ranitidine unapproved products, not discovered and deactivated (NDC codes) by the FDA.
4. MTN has compiled a list of all Ranitidine NDC codes which have been archived and no longer appear on the public list.
5. MTN has reviewed every label for every Ranitidine for comparison to the Reference Listed Drug (RLD) label (patient insert and physician label) and discovered that a plurality of the OTC and Rx generics patient insert and physician labels did not conform to the RLD (brand Zantac). This fact alone should be sufficient to overcome a Mensing defense.
6. There will be far more prescription Ranitidine cases than one might expect. In the last decade, Ranitidine has never failed to make the “Top 50 Most Prescribed Drugs” list with 18 to 20 million prescriptions written per year.
7. The primary defendant in most of the prescription cases will not be one of the NDA or ANDA holders, but instead will be a repacking company.
8. Approximately 80%-85% of client cases firms are likely to sign will be cases in which proper jurisdiction in these States: California, Pennsylvania, New York, New Jersey, and Connecticut.

FILING IN STATE CONSOLIDATIONS vs THE MDL

Why is it so important that proper jurisdiction will arguably exist in California, Pennsylvania, New York, New Jersey, and Connecticut for a significant percentage of Plaintiff cases? All these States’ laws allow for MDL like State Consolidation of Mass Tort cases.

WHY FILE IN STATE CONSOLIDATIONS

It is difficult to consider the MDL a safe venue for filing many, if not most, Plaintiff cases given the recent preemption rulings. Once Plaintiff Leadership files the amended complaint(s), Defense is likely to file preemption motions based on the amended complaints. It is impossible to know how long the MDL Court will take to rule on any new defense motions. If the existing preemption rulings hold, you will have filed your cases at risk of mass dismissal.

It is important to note, that as of January 01/05/2021; less than 1000 individual complaints have been filed or transferred to the MDL, almost exclusively against the brand makers.

While less than 1000 complaints have been filed in the MDL, MTN believes approximately 30,000 have been entered into the “Census” and benefit from the various tolling agreements, regardless of whether the given censused case is filed in the MDL or in another venue.

CAN PREEMPTION BE AVOIDED IN STATE CONSOLIDATIONS?

It is important to understand that MDL Plaintiff Leadership was not in possession of the facts and evidence discovered by MTN over the past 9 months, when the original complaints were filed.

The litigation firms will be working with to cause the various State Consolidations to become available will have all MTN’s research and evidence that will enable them to plead facts and present evidence, never considered by the MDL Court.

The first, and most obvious, argument these firms will be able to put forth is simple:
The fact that FDA prohibits a generic manufacturer (ANDA) from unilaterally making changes to their label and labeling, is irrelevant if the product in question was not approved by the FDA in the first instance.

STAY TUNED

MTN will be reaching out to all our network members soon. Once the litigation teams have been assembled for the various State Consolidations, MTN will provide our network members with an online portal that can be used to correctly identify all possible defendants in your prescription and OTC cases, so you can identify which of your Plaintiff cases may be proper for filing in State Consolidations.
For now, if you are barred in California, Pennsylvania, New York, New Jersey, or Connecticut and are interested in being part of the “State Consolidation” team, email John Ray or Barbara Capasso.

John Ray: john@masstortnexus.com
Barbara Capasso: barbara@masstortnexus.com