Federal Preemption and OTC Drug Efficacy: Lessons from the Phenylephrine MDL

Introduction

In late 2023, an FDA advisory committee concluded that oral phenylephrine, an over-the-counter ("OTC") drug, is not effective at the recommended dosage. Although the committee is independent of the FDA and did not raise any concerns about product safety, the advisory committee's statements triggered lawsuits and prompted the formation of a multi-district litigation ("MDL"). More recently, in October 2024, the MDL court granted a motion to dismiss plaintiffs' consolidated complaint, holding that plaintiffs' state law claims relating to product efficacy were preempted by federal law. This Dechert OnPoint summarizes the MDL court's decision, including the impact of plaintiffs' focus on product efficacy as opposed to safety, and key takeaways for drug manufacturers who routinely rely on the FDA's judgment regarding the effectiveness of OTC drugs when marketing such products.

Regulation of Phenylephrine: Safe and Effective Per Monograph Process

There are two regulatory pathways for OTC drugs. Those pathways include submitting a new drug application to the FDA for approval, "which requires the individual evaluation of each drug product," or using the OTC drug monograph process, which "set[s] the conditions under which OTC drug products in specific drug categories may be marketed without individual product premarket approval."¹

Relevant here, the monograph process for OTC cold and cough medications started in the 1970s, with the FDA appointing an advisory panel to evaluate the safety and efficacy of their active ingredients.² After its review, "[t]he Panel concluded that phenylephrine hydrochloride is safe and effective as an oral and as a topical nasal decongestant for OTC use."³ And when the FDA published its final monograph, it required the label to contain specific terminology about product effectiveness.⁴

Phenylephrine MDL: Fallout From Committee Comments About Effectiveness

Last year, following two citizens' petitions relating to phenylephrine, the FDA's Non-prescription Drug Advisory Committee "discussed new data" and concluded that oral phenylephrine was ineffective at the recommended dosages.⁵ The committee did not, however, raise any safety concerns.⁶ Shortly thereafter, the FDA issued a press release to clarify that the committee "provide[s] independent advice and recommendations," but the FDA "makes the final decision."⁷ And earlier this year, an FDA official reiterated that "the status of oral phenylephrine products remain[ed] the same - they [were] considered generally recognized as safe and effective as OTC nasal decongestants."⁸

Nonetheless, dozens of lawsuits alleged that "[OTC] cough and cold medications containing phenylephrine as the active ingredient to provide decongestant relief do not work as advertised … and are no more effective than a placebo[.]"⁹ The lawsuits included requests for damages in the form of "economic losses and injunctive relief on behalf of putative nationwide and statewide classes of affected consumers."¹⁰ Within months, those cases were centralized in an MDL before Judge Brian Cogan in the Eastern District of New York.¹¹ In order to resolve threshold issues, the MDL Court ordered plaintiffs to file a streamlined consolidated complaint including "representative examples of the conduct and claims" at issue in the litigation and defendants to file a motion to dismiss "raising arguments solely on preemption and/or primary jurisdiction."¹²

Dismissal Based on Scope of Claims: Effectiveness-Not Safety

Last month, the MDL court granted defendants' motion to dismiss because the Federal Food, Drug, and Cosmetic Act ("FDCA") preempted plaintiffs' state-law claims.¹³ As a threshold, the MDL court recognized that the FDCA "selectively employs" express "preemption clauses throughout the statute" and it identified "OTC drug labeling [a]s one such area."¹⁴ Although state product liability actions are exempt from the express preemption clause, plaintiffs did not allege bodily harm or personal injury and "target[ed] only the 'indications' section of the labels, which state that PE was an effective nasal decongestant."¹⁵ Thus, for OTC drugs like phenylephrine, "federal law acts as a floor and a ceiling for state requirements."¹⁶

While assessing whether defendants had a duty to update the label regarding efficacy, the MDL court acknowledged that "the FDCA imposes some duties on drug manufacturers that depend on newly acquired scientific information," such as when a drug poses health risks.¹⁷ For example, the FDA's "changes being effected" regulation allows drug manufacturers to strengthen safety language on a label's warnings without prior FDA approval.¹⁸ But the MDL court did not find any comparable obligation arising from federal law for ineffective drugs, which it held was an "intentional legislative choice" that "reflects a balance between twin aims of the FDCA: safety and uniformity."¹⁹ As a result, "because [plaintiffs'] state claims focus[ed] on efficacy, not safety," the MDL court concluded that "they r[a]n headlong into" express preemption and granted defendants' motion to dismiss.²⁰

At bottom, the decision reaffirms that "[t]he FDCA empowers the FDA, not drug manufacturers, to determine whether a drug is effective."²¹ By extension, it confirms that drug manufacturers selling OTC drugs and crafting corresponding labels can continue relying on the FDA's determinations about product efficacy to defend against private litigants' claims second-guessing the FDA's determinations.

FDA's Subsequent Proposed Order: Anticipated Impact

Just last week, following its own review of the available data, the FDA "announced it is proposing to remove oral phenylephrine as an active ingredient that can be used in [OTC] monograph drug products for the temporary relief of nasal congestion."²² Like the advisory committee's conclusion, the FDA's reasoning was "based on effectiveness concerns, not on safety concerns."²³

The FDA's proposed order (and any consistent final order) should not change the MDL court's holding with respect to decongestants sold based on the operative FDA regulations that deemed oral phenylephrine effective at those times. As the FDA stated, "[o]nly a final order will affect what products can be marketed."²⁴ Thus, "[f]or now, companies may continue to market OTC monograph drug products containing oral phenylephrine as a nasal decongestant."²⁵

Takeaway: The Phenylephrine dismissal is a well-reasoned opinion that should deter, and support defenses against, misbranding claims for OTC products relating to effectiveness.

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