As Jurisprudence Under Loper Bright Develops, Early Scorecard is Mixed

Back in July, the United States Supreme Court turned the world of administrative law on its head, adding new layers of judicial oversight to what might have previously been thought of as fairly non-descript Federal agency functions. One of those cases was Loper Bright v. Raimondo, which formally overruled the 40-year precedent under Chevron, under which courts gave agencies deference when interpreting statutory ambiguity.

The early scorecard indicates that rulings that consider Loper Bright may not prove to be a complete death knell to FDA’s statutory interpretations. For example, a recent decision in the D.C. District Court denied Novartis its attempt to block a generic version of its heart failure drug Entresto from the U.S. market. The opinion cited a central holding from Loper Bright, that “courts need not and under the APA may not defer to an agency interpretation of the law simply because a statute is ambiguous.” However, the court decided that FDA did not overstep its authority in approving the generic and refused to substitute its own opinion where the agency had reasonably applied its technical expertise.

As that case seems likely to hit the Circuit Court of Appeals’ docket, another example out of D.C. may very well add to the workload there. We have previously blogged about Jazz Pharmaceuticals’ challenge to FDA’s clinical superiority decision concerning sodium oxybate in the treatment of narcolepsy. The D.C. District Court recently rejected FDA’s argument that it is entitled to deference for its reasonable reading of the FDCA, touching on Loper Bright. However, the court still denied Jazz’s request for summary judgment, finding that the agency’s decision-making was reasoned and rational. More on this case coming to the Blog soon.

Other recent complaints filed against FDA are attempting to mix Loper Bright into their pleadings. In one, Eli Lilly has challenged FDA’s decision to classify its anti-obesity product Retatrutide as drug instead of a biological. It’s asking the Southern District of Indiana to weigh in on the definition of the word “protein” under the judicial authority Loper Bright grants. In another case in the Northern District of Texas, the Outsourcing Facilities Association (OFA) recently sued FDA regarding the agency’s sudden removal of obesity drug Tirzepatide from the federal drug shortage list without also providing required notice. The OFA cites Loper Bright as authority that the court should interpret the relevant parts of the FDCA without deference to the Agency. And we blogged last week about a suit against FDA over provisions of the 2020 CARES Act, where the Alliance for National Health USA invokes Loper Bright and asks the D.D.C. to deprive FDA of judicial deference for its pronouncement that homeopathic cures must obtain new drug approvals or exist in the uncertain realm of FDA’s exercise of enforcement discretion.

Of course, Loper Bright wasn’t the only blockbuster admin law case this year. SEC v. Jarksey held that if agencies want to levy civil monetary penalties, they can only do so after first winning a jury trial. Ohio v. EPA promises to apply downward pressure on agencies to closely scrutinize and more fully respond to comments made during the rule-making process. Corner Post v. Board of Governors of the Federal Reserve extended the statute of limitations for challenges to agency rules. The pace at which these different rulings will evolve and impact FDA will differ. We wrote recently that it took all of three months for the first challenge to FDA’s civil money penalty authority under Jarksey, in a case over the sale of an electronic cigarette without FDA authorization. Given the time that a case under Ohio v. EPA or Corner Post might take to ripen, effective litigation strategies under those rulings—either for or against FDA—might take longer to mature.

Somewhere in the middle on this timeline, though, is Loper Bright. Disputing FDA’s deference is fast becoming de riguere, and we’ll be back with more as these cases develop.