The U.S. FDA’s enforcement regarding products related to the COVID-19 pandemic has picked up steam recently, but the U.S. Federal trade commission (FTC) is also involved in this enforcement arena. Leonard Gordon, a partner at Venable LLP’s New York office, told BioWorld that while the FTC and FDA missions seem to overlap, the FTC primarily targets unsupportable advertising claims rather than product labeling, a particularly relevant area in the COVID-19 pandemic.

The FTC has issued a number of warning letters to makers of a variety of product types, including a letter to a manufacturer of a face brush promoted for the capacity to “fight off coronavirus.” The FTC website lists a number of solo FTC warnings and joint FDA/FTC warnings, providing some insight into the functional overlap between the two agencies.

Gordon said the FTC relies on many of the same sources for complaints as the FDA, such as consumers and a company’s competitors, but that it also does its own surveillance. “I’m sure there’s a team of lawyers” at the FTC conducting web searches to root out phony cure claims, he said, adding that state attorneys general may also forward items to the FTC that fall into the agency’s wheelhouse.

The FTC is more geared to address strict advertising than the FDA, which at times will hit a device maker’s website promotions as an extension of product labeling, but Gordon said the FDA may have to go through the Department of Justice to prosecute offenders. Conversely, the FTC ordinarily relies on lawsuits, given that it is primarily directed to pursue violations that fall under civil rather than criminal code.

Outlandish claims suggest outlaw sponsor

Gordon said the egregiousness of the advertised claims seems to be a trigger for FTC enforcement action, adding that the agency has sent out a large volume of letters recommending that the target cease and desist its violative behavior. The FTC can sue administratively and obtain an injunction in federal court, and can seek disgorgement of profits. However, those pleas for disgorgement of profits do not always fall on receptive ears.

The agency has several statutory authorities, including a number not directly related to product promotion, including a provision under the Defense Production Act of 1950. Section 708 of the DPA requires FTC and the DoJ to develop and execute plans for monitoring any voluntary production agreements undertaken pursuant to the DPA. However, two members of the U.S. Senate recently urged FTC chairman Joseph Simons to allow the agency to “provide clear public guidance into its power” to address price gouging, although they also posed the question of whether the agency has any explicit authority to do so under the agency’s scope of “deceptive acts or practices.”

“A lot of times, the FTC will demand substantiation” of an advertisers claims before taking action, Gordon said, and sometimes the agency simply drops the matter at that stage. In some instances, the two parties will settle out of court but if the advertised claims are really aggressive, and there’s a risk of harm, FTC will pursue immediate action, he said.

“They talk to each other a lot,” Gordon said of the FTC and the FDA, and at times, resource allocation is a factor in determining which agency will take a case. “You have to make sure you have the science to back up your claims,” he continued, adding that if the claims are clinically substantiated, the resolution may come simply by presenting the agency with the underlying data. The FTC standard here may sound a lot like the FDA standard in the sense that the terminology used to describe that evidentiary standard is usually “valid scientific evidence,” and Gordon noted that this is usually interpreted by the FTC as evidence that experts in that field would deem adequate.

Nonetheless, Gordon said, the FTC sometimes seems to decide case-by-case what constitutes valid scientific evidence, so advertisers are encouraged to generate evidence that passes the sniff test.

Reasonable consumer standard’ recited in vain

There are at times some disagreements among the FTC commissioners about the scope of relief when the sponsor can demonstrate the product has some value, Gordon said. He pointed to the FTC determination in a case against Neurometrix Inc., of Waltham, Mass., as an example of dissent on the part of the five FTC commissioners. The FTC announced in early March that it had come to terms with Neurometrix over the company’s claim that its Quell device can treat pain throughout the body when placed below the knee. The agency said the company has been promoting the transcutaneous electrical stimulation (TENS) device as a clinically proven method of providing widespread chronic pain relief, and that the company had claimed it had an FDA clearance for that indication.

The $4 million judgment had to be paid within 30 days of the decision, but the FTC said the company is also on the hook for another $4.5 million in foreign licensing payments as well. While the overall decision was unanimous, commissioner Christine Wilson dissented in part on the point of whether the evidence provided by the company substantiates the claim that the TENS device “can provide some non-localized pain relief.”

Wilson further disputed the notion that consumers necessarily extrapolated the advertisement regarding FDA clearance to the company’s claim regarding non-localized pain relief. She said that the evidence was insufficient for her to conclude that “a reasonable consumer would reach this net impression.”

No Comments