A state appeals panel has ruled a controversial California product labeling law conflicts with federal pharmaceutical guidelines, protecting generic drug makers from certain state court litigation.
The Center for Environmental Health filed a lawsuit against companies that made generic, non-prescription antacids, alleging the drugs contain a known carcinogen. That ingredient is n-nitrosodimethylamine, or NDMA, which plaintiffs allege “is used in laboratory research to induce tumors in experimental animals.” CEH alleges the chemical can form during manufacturing of drugs that contain the drug ranitidine, a conclusion they said is corroborated through independent research as well as testing by the U.S. Food and Drug Administration.
In addition to claims under the 1986 Safe Drinking Water and Toxic Enforcement Act, the suit invoked a health and safety code section of California Proposition 65, which requires any product sold in the state to provide a clear and reasonable warning if it contains any of roughly 1,000 chemical carcinogens and reproductive toxins on a list the California Office of Environmental Health Hazard Assessment updates continuously.
Jim Humes
| courts.ca.gov
In a separate action, CEH sued two manufacturers of Zantac, the brand name version of ranitidine made by defendants Dr. Reddy’s, Perrigo, Apotex, Granules USA and sold through defendants Target and 7-Eleven. In both actions, defendants argued the federal Food, Drug and Cosmetic Act pre-empts a state law claim.
Alameda County Superior Court Judge Winifred Smith sided with the generic defendants, dismissing the complaint without leave to amend. But when siding with the name brand defendants allowed leave for CEH to amend its pleading, so that suit remains pending.
CEH challenged the judgment in favor of the generic defendants before the California First District Appellate Court, which issued its opinion on the matter March 9. Justice Jim Humes wrote the opinion. Justice Kathleen Banke concurred, as did Raymond Swope, a San Mateo County Superior Court judge appointed to the panel for these proceedings.
The panel said Judge Smith was correct to dismiss the complaint. Smith said the federal obligation for a generic drug to carry the same label as a brand-name product couldn’t be squared with Prop 65 dictates. Only if a name-brand manufacturer put a Prop 65 warning on its product labels could a state court force a generic maker to do the same.
The ruling marks a victory for companies who argue Prop 65 is a tool best suited to generate legal fees for attorneys representing plaintiffs in litigation over labels. In 2019, for instance, according to the California Attorney General’s Office, more than 900 Prop 65 settlements generated almost $30 million for plaintiffs, with nearly $24 million going to attorneys.
Humes stressed the panel’s ruling has limited reach, in part because NDMA is a contaminant, not an intended ingredient. If the drugs still are sold as such, Humes said, “A lawsuit seeking to require warnings that the products contain NDMA — which, again, is not supposed to be in them at all — seems a poor way to address the potential danger to consumer health. Consumers would likely be better protected by removing the contaminated drugs from the market than by allowing the drugs’ sale, even with a warning, in a contaminated state.”
Furthermore, the panel said, the intent of Prop 65 is regulating toxins deliberately introduced through human activity, so even though the panel ultimately agreed federal law inhibits state drug label lawsuits under Prop 65, “no such labeling is likely to result” because NDMA isn’t supposed to be in the drugs at all.
Humes also wrote the opinion regarding generic defendants has no bearing on Zantac manufacturers, who could yet “unilaterally add a Proposition 65 warning to their products,” or a state court could force the issue on name-brand drugs. Then, the question of whether CEH’s claim against the generic defendants is pre-empted would become irrelevant.
Even so, the panel determined CEH’s arguments contained no scenario under which the generic defendants could concurrently meet federal sameness and Prop 65 guidelines. It rejected arguments in an amicus brief from California Attorney General Ron Bonta, who said the sameness rule is intended to serve national uniformity and not consumer health. Humes wrote sameness exists to ensure generics have the same safety and effectiveness of name brand drugs, a concept that eliminates redundant clinical trials.
Attorneys Mark N. Todzo and Joseph Mann, of Lexington Law Group, are representing the Center for Environmental Health.
Representing the generic defendants are attorneys from several firms, including Steptoe & Johnson; Goodell, DeVries, Leech & Dann; Norton, Rose, Fulbright US; Lewis Brisbois Bisgaard & Smith; Arnold & Porter Kaye Scholer; Blank Rome; and Gordon Rees Scully Mansukhani.