Court Affirms Criminal Convictions for Device Execs Under the FDCA

by Amanda Johnston

The U.S. Court of Appeals for the First Circuit recently upheld multiple misdemeanor convictions for two former medical device company executives under the Food, Drug and Cosmetic Act (FDCA). While the former executives challenged their convictions on multiple statutory and constitutional grounds, the Court of Appeals ruled against each of their challenges—affirming the district court’s decisions on both conviction and sentencing.

Overview

The Food, Drug and Cosmetic Act imposes several restrictions and prohibitions on the marketing of medical devices and other products regulated by the U.S. Food and Drug Administration (FDA). While many enforcement actions under the FDCA are civil in nature, the statute also includes provisions for criminal enforcement. Notably for purposes of this case, the “introduction or delivery for introduction into interstate commerce of any . . . device . . . that is adulterated or misbranded,” is a strict-liability misdemeanor offense under the statute, meaning that evidence of intent is not required to sustain a conviction. In cases involving evidence of intent, federal prosecutors can pursue felony charges.

As determined by the district court, the appellants violated the FDCA’s prohibition on introducing adulterated and misbranded medical devices into the market. As the Court of Appeals explained, under 21 U.S.C. § 331(a):

• "A device is adulterated or misbranded if its ‘intended use’ -- as determined objectively by the seller's statements and conduct -- differs from the use(s) for which the FDA has cleared it."

At trial, the district court found that the appellants violated § 331(a) by internally and externally promoting one of their company’s devices for uses not cleared by the FDA, i.e., off-label use. While practitioners “may lawfully prescribe and administer a device for an off-label use as long as that device has received § 510(k) clearance for any intended use,” manufacturers are prohibited from promoting their devices off-label.

This was the crux of the case at trial, and the district court concluded that the former executives’ efforts to train internal personnel regarding off-label use promotion and encourage off-label use by practitioners (among other acts) were sufficient to constitute misdemeanor violations of the FDCA. The Court of Appeals disagreed with the appellants’ arguments for reversal and sustained their respective $1,000,000 and $500,000 fines.

Conclusion

The Court’s decision is a clear signal to medical device companies and executives about the strict enforcement of the FDCA. It highlights that off-label promotion, including internal sales training practices, can lead to criminal charges under the FDCA. Upholding substantial fines, this ruling emphasizes the importance of compliance with FDA regulations.