By Edward J. Fanning, Jr., David R. Kott, and Natalie H. Mantell, Partners, and Steven H. Del Mauro, an Associate, in the Newark, NJ office of McCarter & English LLP. Ms. Mantell was counsel of record and a member of Roche’s litigation team in In Re: Accutane. Mr. Fanning and Mr. Kott represented The HealthCare Institute of New Jersey, co-authoring the amicus brief which Mr. Fanning argued before the New Jersey Supreme Court.
New Jersey, home to many of the country’s pharmaceutical and medical device companies, is one of only a few states that provides a presumption of adequacy for warnings that are cleared or approved by the federal Food and Drug and Administration (“FDA”). N.J.S.A. § 2A:58C-4. Of the limited jurisdictions that do apply a presumption of adequacy, New Jersey’s is a difficult one for plaintiffs to overcome, as the state’s high court has described it as “virtually dispositive” and a “super presumption.” Rowe v. Hoffmann-La Roche, Inc., 189 N.J. 615, 625-26 (2007); Kendall v. Hoffmann-La Roche, Inc., 209 N.J. 173, 195 (2012). On October 3, 2018, the New Jersey Supreme Court issued a decision that reaffirmed the strength of the presumption of adequacy for FDA-approved warnings under the New Jersey Products Liability Act (“PLA”). Moreover, the court provided much needed clarity on the choice-of-law analysis to be applied when deciding an omnibus motion that affects hundreds of cases within a Multicounty Litigation (“MCL”), which is analogous to a federal Multidistrict Litigation.
In In re: Accutane, the trial court granted Roche’s omnibus motion for summary judgment under New Jersey law, thereby dismissing all 532 cases against it in which plaintiffs alleged that Accutane caused their inflammatory bowel disease (“IBD”) and that Roche failed to provide adequate warnings regarding the known risks of that medication. In re: Accutane Litig., ___ N.J. ___, 2018 WL 4761403, at *5 (Oct. 3, 2018). Only 18 of the 532 plaintiffs were New Jersey residents, and the remaining 514 were from 44 other jurisdictions. Id. The Appellate Division reversed, and the New Jersey Supreme Court granted Roche’s petition for certification. The two issues before the court were (1) “what law governs whether Roche’s label warnings were adequate—the law of each of the 45 jurisdictions where plaintiffs were prescribed Accutane or the law of New Jersey where the 532 cases are consolidated for MCL purposes”; and (2) “the adequacy of the label warnings for the period after April 2002.” Id.
If New Jersey law governed the adequacy issue, Roche would have been entitled to a strong presumption that its FDA-approved warnings were adequate as a matter of law pursuant to the PLA. If the laws of each of the 45 jurisdictions applied, however, the PLA’s presumption of adequacy would not govern every claim and the standard would vary by state. Id. at *15-*16.
In analyzing choice of law under the “most significant relationship” test under New Jersey’s seminal choice-of law decision, P.V. v. Camp Jaycee, and under the Restatement (Second) of Conflicts of Laws §§ 145, 146 and 6, the New Jersey Supreme Court found that weighing the § 145 contacts yielded mixed results, id. at *19, and emphasized the importance of two § 6 factors to this MCL matter: § 6(f) (“certainty, predictability, and uniformity of result”) and § 6(g) (“ease in the determination and application of the law to be applied”), id. at *20. The court noted that applying one state’s law on the issue of adequacy to all 532 cases at issue in this appeal “will ensure predictable and uniform results,” and stated, “[t]here can be no question that administrative ease and efficiency favor the application of New Jersey’s PLA.” Id. Roche’s status as a New Jersey-based corporation, which manufactured and labeled Accutane in New Jersey, also influenced the Supreme Court’s decision. Id. at *6, *19. Consequently, the PLA applied to all 532 cases. Id. at *20.
Turning to the merits, the court set forth the standards for overcoming the PLA’s rebuttable presumption of adequacy. It reiterated the two existing pathways for overcoming the presumption: (1) establishing “deliberate concealment or nondisclosure of after-acquired knowledge of harmful effects” from the FDA, id. at *24 (citing Perez v. Wyeth Labs., Inc., 161 N.J. 1, 25 (1999); or (2) proving “economically driven manipulation of the post-market regulatory process.” Id. (citing McDarby v. Merck & Co., 401 N.J. Super. 10, 63 (App. Div. 2008). The Supreme Court, however, added a third pathway for overcoming the presumption that had not yet been articulated in any New Jersey case law—a plaintiff can rebut the presumption if he or she “presents clear and convincing evidence that a manufacturer knew or should have known, based on newly acquired information, of a causal association between the use of the drug and ‘a clinically significant hazard’ and that the manufacturer failed to update the label accordingly.” Id. at *2 (citing 21 C.F.R. §§ 201.57(c). 314.70(c)).
Critically, the Supreme Court emphasized the heightened nature of the clear-and-convincing evidentiary standard, and specifically included the definition contained in the Model (Civil) Jury Charges: “[I]t is evidence so clear, direct, weighty in terms of quality, and convincing as to cause [one] to come to a clear conviction of the truth of the precise facts in issue.” Id. (quoting N.J. Model Civil Jury Charges 1.19).
In establishing this elevated hurdle for plaintiffs to overcome, the New Jersey Supreme Court acknowledged the FDA’s preeminent role in regulating drugs and medical devices. Id. at *21. Indeed, the court spent considerable time detailing the federal regulations that govern a pharmaceutical company’s New Drug Application, id. at *21-*23, and made clear that its decision incorporated the “general directive that federal regulations are of the utmost significance in determining whether ‘a manufacturer satisfied its duty to warn the physician about potentially harmful side effects of its products.’” Id. at *25 (quoting Perez, 161 N.J. at 24). Notably, the court added “one caveat” to the third pathway for overcoming the presumption of adequacy, which expressly incorporates compliance with FDA regulations into the PLA: “A manufacturer that acts in a reasonable and timely way to update its label warnings with the FDA, in accordance with its federal regulatory responsibilities, will receive the protection of the rebuttable presumption. If not, it cannot seek shelter behind it.” Id. at *26.
Applying the PLA to the facts of these cases, the Supreme Court found that “plaintiffs have failed to show any of those bases for overcoming the presumption of adequacy”, id. at *27, and Roche’s warnings were therefore adequate as a matter of law. As a result, the New Jersey Supreme Court dismissed all 532 cases. Id. at *28.
This decision sets a very high standard for overcoming the presumption of adequacy for FDA-approved warnings, providing significant support for pharmaceutical and medical device manufacturers defending against failure-to-warn claims in New Jersey. Indeed, the court reaffirmed the long-standing principle that FDA review and approval of a product’s warnings is virtually dispositive of whether the warnings are adequate as a matter of law. Further, when faced with a complex choice-of-law issue, particularly one that would require a trial court to analyze 44 other states’ laws in deciding a single motion, the New Jersey Supreme Court paid particular attention to efficiency and uniform results in the MCL context.