By Bill Cash

December 10th, 2012  3:15pm

Last week, a panel of the United States Court of Appeals reversed the conviction of a drug company employee who encouraged doctors to prescribe a dangerous drug to inappropriate populations and for unapproved diseases.  This is a closely-watched decision that has a lot to say about companies’ responsibilities to doctors and patients.  If the decision stands, it could affect the safety of patients across the United States.

Alfred Caronia was a sales representative for a small drug company, Orphan Medical.  Orphan sold a drug called Xyrem, whose active ingredient is known as gamma-hydroxybutyrate or GHB.  GHB, which can be a highly dangerous drug, is also known as “the date rape drug” because of its use in committing sexual assaults.  In fact, the FDA believed Xyrem was so dangerous, it could only be distributed through a single pharmacy in Missouri.

Nevertheless, Xyrem was approved for sale in the United States, but only for very specific uses: for narcolepsy patients who experienced weak or paralyzed muscles, or who experienced excessive daytime sleepiness.

Mr. Caronia and Orphan were determined to increase sales of Xyrem, and Mr. Caronia’s salary depended almost exclusively on his sales record.  According to the facts in the case, Mr. Caronia’s numbers were among the worst of all Orphan sales representatives. A drug company’s sales representatives make their living by encouraging doctors to prescribe drugs to their patients.  In this case, Mr. Caronia actually had Orphan hire a medical doctor with experience in prescribing Xyrem to work with him in talking to other doctors.

The government became aware that Mr. Caronia was encouraging doctors to prescribe Xyrem for uses other than narcolepsy.  Using an informant, the government was able to tape Mr. Caronia encouraging prescriptions of Xyrem for chronic muscle disorders, chronic pain, fibromyalgia, insomnia, and other disorders outside the drug’s approval.  He also explained to doctors that the drug could be used in children and the elderly, which were age groups not approved to receive the drug.

It is a crime to sell a misbranded drug in interstate commerce, and in 2008, a jury convicted Mr. Caronia of conspiracy to introduce a misbranded drug into interstate commerce in violation of the federal drug laws.  Mr. Caronia was sentenced to one year of probation and 100 hours of community service.

It appears to have been the government’s theory at the trial that by making misleading or false statements about the safety and effectiveness of Xyrem, Mr. Caronia caused Xyrem to be sold in a way that made it misbranded.  Mr. Caronia appealed his conviction, and last week, the U.S. Court of Appeals overturned it.

On appeal, a 2-1 panel of the Second Circuit Court of Appeals divided over whether the conviction was lawful.  The majority argued that Mr. Caronia’s First Amendment speech rights were at issue, and that he had a right to engage in the speech of his choosing — even if it was directed toward the promotion of a drug for an unapproved purpose.  In the majority’s view, Mr. Caronia’s free speech rights trumped any concern for patient safety that might be served by his conviction because the government had other ways to protect patients from the use of an unapproved drug.

The dissenting judge rejected the First Amendment rationale, reasoning that speech is an essential element of many crimes, such as conspiracy, attempt, antitrust violations, and others.  Further, if the government could not prosecute individuals for making statements intended to encourage the unsafe use of drugs, patients would be at risk and the government’s whole scheme of drug regulation would be upset.

This decision could have a big impact on patient safety.  There was no dispute among the judges that Mr. Caronia clearly engaged in the promotion of Xyrem, the “date rape drug,” for dangerous, unapproved uses — with a direct, personal financial interest in such promotion.  The difference came down to whether Mr. Caronia had a right to do so under the First Amendment.

Because of the unique nature of their business, with huge upfront costs and a guaranteed but time-limited monopoly on the sale of their products, drug companies have powerful incentives to maximize their sales before patents run out.  That is why the federal government needs to carefully regulate their conduct.  This decision is a disappointment for those concerned with patient safety.  Drug sales representatives are low-level employees, often with little or no medical training, who have only one function: to push pills.  Their employers, some of the largest corporations in the world, have vast financial resources and are easily able to absorb most penalties if they are caught selling misbranded drugs.  The criminal prosecution of individual drug sales representatives provides a powerful deterrent to what would otherwise be completely immunized behavior.  If the Caronia decision stands, it will give other sales reps license to say whatever is necessary to boost sales and profits at the expense of patient safety.

At this time, it too early to say whether the government will appeal the Second Circuit’s decision to the U.S. Supreme Court.  The Supreme Court has taken many high-profile pharmaceuticals cases in recent years.  If it takes this case, Mr. Caronia’s conviction could be reinstated.

Bill Cash is an associate at Levin, Papantonio, Thomas, Mitchell, Rafferty & Proctor, P.A.  Mr. Cash represents people wrongfully injured across the United States.  He concentrates his practice mainly in the area of products liability, including pharmaceuticals and other consumer products, but occasionally also handles other personal injury claims and contract cases.