Who’s Next In Congressional Hot Seat? Pharma Industry Could Replace FDA

Congress will not keep up its intense scrutiny of FDA when President-elect Barack Obama takes office, drug and device lawyers predict. Instead, Capitol Hill will shift its attention to pharmaceutical company practices.

Speaking at the 13 annual Conference on Drug and Medical Device Litigation in New York on Dec. 11, attorneys predicted that congressional investigations will take a different course with Democrats controlling both the White House and Congress.

"We do expect pharmaceutical investigations to continue into the near future," said Paul Schmidt, a partner at Covington & Burling. But "we may see a real change in the focus of those investigations."

Over the past several years, Congress has heavily scrutinized FDA for what some members see as an overly politicized agenda and an overall failure to protect the public heath. Recent oversight hearings have focused on food and drug safety and the FDA inspections process.

"That to a large extent has hurt industry but it's also diverted focus elsewhere," Schmidt said. "With a divided government you get more investigations for investigation sake than for legislative purposes."

While much of the health care policy agenda will be consumed by health reform, oversight activities are likely to track closely with Congress' legislative goals for the next session. The cost of drugs - especially novel biotech products - has been a hot-button issue for some time, and is a likely topic for scrutiny by the incoming Congress, Schmidt said.

Schmidt also predicted more oversight of direct-to-consumer advertising as Rep. Henry Waxman, D Calif., who is to chair the House Energy and Commerce Committee, has expressed interest in legislation on DTC (¹ (Also see "PhRMA’s Revised DTC Code Shies Away From Internet; Not Celebrities" - Pink Sheet, 15 Dec, 2008.), p. 28).

Congress Plays Role In Pre-emption Litigation

Product liability litigation will be another big topic for Congress in the coming session, and one drug companies should be watching carefully.

Certain members of Congress - notably Rep. Waxman - have already wielded much influence on the issue of pre-emption, the legal doctrine holding that federal law trumps conflicting state law.

Waxman, who believes that states should have the right to sue over product liability claims, held a hearing in May to make a case against pre-emption - a hearing that received a lot of media attention (² (Also see "Rep. Waxman Launches Salvo Against FDA Pre-emption Of State Tort Suits" - Pink Sheet, 19 May, 2008.), p. 21).

And just before the U.S. Supreme Court took up the issue of pre-emption in Wyeth v. Levine, Waxman issued a report revealing top FDA scientists had disagreed with the agency's position on the doctrine (³ (Also see "Pre-emption Rule Delays Safety-related Label Changes, Waxman Charges" - Pink Sheet, 3 Nov, 2008.), p. 11).

Waxman's report on the internal FDA discussions has made it easier for litigants to push their case in court. Andrew Bayman, a partner at King & Spalding, noted that litigants are filing Waxman's report as supplemental authority in their arguments against pre-emption.

"Congress has incredible power to generate discovery that would not otherwise be generated" and put forward prominent witnesses that litigants can try to use down the road, Schmidt said.

Obama Also Tougher On Industry

The Obama Administration will also make life harder for the pharmaceutical industry. Anand Agneshwar, a partner at Arnold & Porter, said the situation is ripe for a serious overhaul of FDA and its regulation of drugs.

"FDA will show that it is now doing the oversight that people think it hasn't been doing," he said. "We're going to see more warning letters. We're going to see more of a focus on direct-to-consumer advertising, off-label use and marketing practices."

Agneshwar also noted that Obama has taken a stand against pre-emption. He is one of the co-sponsors of the Medical Device Safety Act, which would reverse the Supreme Court's pro-pre-emption ruling in Riegel v. Medtronic. And during the campaign Obama indicated that he would end attempts to protect drug companies from product liability.

But Agneshwar is optimistic that Obama has a broader vision of health care reform that goes beyond oversight of the pharma industry. "Sometimes what he does is less drastic than what his rhetoric has been in the election."

- Brenda Sandburg ([email protected])