Saturday, October 3, 2009

Allergan's Free-Speech Suit Against FDA

For the first time a drug maker, Allergan (NYSE:AGN), filed suit Thursday against the FDA and US government for violating the First Amendment of the right to free speech.

Currently, drug companies are prohibited from communicating anything related to uses of a drug that is unapproved by the FDA. But once a drug is approved, doctors can prescribe the drugs for uses other than what the drug was approved for. In this way the Botox-manufacturer wants to legally share with doctors what it calls "truthful and relevant" information concerning off-label uses of Botox such as dosing, patient selection criteria, and injection technique.

Allergan contends that 1 out of 5 drugs in the US are prescribed for off-label uses, and although the company won't disclose what that statistic is for Botox, it does say that half of Botox prescriptions are for medical, rather than cosmetic, reasons.

Regulatory authorities have approved botox not just for wrinkles but for 21 indications in 80 countries, including eyelid spasms, excessive sweating, crossed eyes and neck contortions. But doctors still prescribe Botox for unapproved uses such as facial spasms and headaches.

Whatever the ruling will be (NYT cites analysts who believe Allergan won't really pursue the lawsuit and is just using it as leverage for wiggle-room in providing off-label information), there's no doubt other drug companies are watching closely. But I doubt Allergan can win this one. After all, if drug companies are able to share such information with doctors, the FDA will have to investigate whether that information is true, so what's the point? The FDA might as well just approve it for that use anyway. Or will it be that the FDA-approved uses are more thoroughly approved than the non-approved uses because approving everything will take too long? Or if companies are just allowed to say whatever they say is "truthful" who will have the time to monitor those claims? It just doesn't seem viable either way.

And Allergan's investors seem to know it too. The company's shares fell 1.77 percent when the market closed Friday at $54.96.

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