The U.S. Chamber of Commerce is coming to the defense of a Minnesota medical device company and its CEO, saying criminal charges pending against them will not withstand First Amendment scrutiny.
Vascular Solutions Inc. of Maple Grove and its CEO, Howard C. Root, are facing misdemeanor and felony charges of marketing a varicose-vein treatment device for a medical procedure that was never approved by the Food and Drug Administration. The FDA explicitly warned the company about the marketing beforehand, noting in the indictment the procedure could put patient safety at risk.
On Monday the nation's largest business-rights group filed a friend-of-the-court brief in the case, arguing that two recent federal court decisions make clear that Root and Vascular Solutions had a First Amendment right to truthfully promote nonapproved uses of the device to doctors.
Billions of dollars in sales and legal settlements are at stake in the national fight over health care marketing. The Department of Justice has regularly extracted multimillion- and billion-dollar settlements from companies accused of off-label marketing, though the cases rarely proceed to trial. Large publicly traded companies regularly settle rather than face the uncertainty of a trial, even though the Second U.S. Circuit Court in New York ruled in 2012 that the FDA cannot apply special speech restrictions to health care product makers.
"The remarkable thing about the government's 'off-label marketing theory' is that it would impose criminal liability on speech without proof of any falsehood," Warren Postman, the chamber's associate chief counsel for litigation, said in a e-mail to the Star Tribune. "According to the government, it is a crime to engage in truthful speech about a lawful use of a lawful product. That just can't be squared with the First Amendment."
Not guilty plea
Vascular Solutions and Root have pleaded not guilty and struck a defiant tone in court filings, directly accusing prosecutors of misconduct in a motion to dismiss the indictment last week. "We welcome the chance to demonstrate the truth before the court," a statement on the company's website says.
The Chamber of Commerce filing argues that the case against the company and the CEO conflicts with recent Supreme Court and Second Circuit decisions.
"First, the government permits physicians to employ medical devices for any off-label use they find medically appropriate," the Chamber of Commerce filing says. "Second, the government prohibits manufacturers from communicating with doctors regarding such off-label uses. This regime, which allows doctors to treat perforator veins with the Vari-Lase system, but bars Vascular Solutions from giving doctors information on such a use, cannot survive First Amendment scrutiny."
The Vari-Lase system is actually a group of devices sold by Vascular Solutions used to treat diseased leg veins by blocking them off with laser energy. The indictment alleges that the company illegally conspired to tell doctors how to use a specific Vari-Lase product called the "short kit" to seal off perforator veins deep in the legs, even though the device was only approved to treat superficial veins near the skin's surface.
Blood clot fear
The indictment says laser energy in deeper veins may create dangerous blood clots in a patient's vasculature, though it cites no specific case of this happening.
Joyce Branda, who was acting assistant attorney general for the Justice Department's civil division when the indictment was unsealed last November, has said internal e-mails and sales presentations show "a deceptive sales campaign led by the CEO of a public company."
The company voluntarily pulled the short kit off the market last year after paying a $520,000 settlement to resolve similar off-label marketing claims contained in a civil whistleblower lawsuit. The company denied any wrongdoing at the time.
On Tuesday, a spokesman for Vascular Solutions declined to comment on the Chamber of Commerce filing. The brief says the chamber's lawyers drafted it without input or funding from the defendants.
The lawyers representing the Chamber of Commerce hail from national law firm Jones Day, which has litigated high-profile health care lawsuits against the Obama administration. Jones Day attorney Michael Carvin, co-counsel on the Vascular Solutions filing, argued on behalf of critics in both Supreme Court challenges to the Affordable Care Act.
Vascular Solutions stock had been trading just above $30 a share before dropping 22 percent on the indictment news last November. It has since rallied, closing Tuesday at $38.64 a share.