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From Health Law Daily, December 31, 2013

Classification of eyelash growth products confirmed, injunction altered

By Melissa Skinner, JD

The Court of Appeals for the Federal Circuit confirmed the finding that an eyelash growth product was properly considered a drug and, therefore, upheld the lower court’s finding of summary judgment based on unfair competition for an unapproved drug. While the court also approved the decision that the Food, Drug and Cosmetic Act (FDC Act) did not preempt state-based unfair competition allegations, the court did not agree with the extent of the injunction applied by the lower court and, in turn, directed that the injunction be limited (Allergan, Inc. v Athena Cosmetics, Inc., December 30, 2013, Moore, K).

Background. Allergan, Inc. (Allergan) brought suit against Athena Cosmetics, Inc. (Athena) claiming patent infringement and violation of the California Business and Professions Code for unfair competition. Allergen holds a patent on its product Latisse, which contains a prostaglandin derivative and has been approved by the FDA as a prescription drug used to treat and promote eyelash growth. Allergen claimed that Athena’s product line, RevitaLash, infringes on the Latisse patent and the marketing of that product constituted unfair competition under California law because Athena did not get the proper FDA approval of the product as a new drug.

The district court denied Athena’s arguments that the unfair competition claims were preempted by the FDC Act and granted Allergen’s motion for summary judgment. Allowing Allergen’s motion, the district court found that no genuine issue of material fact existed as to whether Athena intended to market its product as one intended to change the structure of the eyelash or, in other words, as a drug. The district court entered a permanent injunction barring Athena from manufacturing, marketing, selling, and offering its product anywhere in the United States.

Preemption. The Federal Circuit Court confirmed the district court’s finding that the FDC Act did not preempt the California unfair competition claim because there is not a clear intention by Congress to preempt state law in this area of prescription drugs as compared to other areas, such as non-prescription drugs and medical devices, where Congress has shown that intention. Additionally, the court noted that compliance with California law does not impede the fulfillment of the FDC Act standards but instead the two statutes contain “parallel provisions” and “consistent goals.”

Summary judgment. Finding that the intended use of Athena’s eyelash product, which was indicated by a number of factors including the product’s labeling and marketing, implied that the product was a drug, the Federal Circuit confirmed the grant of summary judgment on the issue of unfair competition. In so finding, the court dismissed Athena’s arguments that prior formulations of the product might have been marketed as a drug product but recent reformulations were not. The court found that despite the reformulations, Athena continued to refer to products’ abilities to change the physicality of the eyelash and that was sufficient to show it was properly considered a drug.

Injunction. The Federal Circuit, however, did not agree with the lower court’s imposition of a permanent injunction across the entire United States. Although the district court found that the injunction was not in violation of the Commerce Clause, the Federal Circuit found the entry of an injunction of that scope was an abuse of discretion and was in contradiction to the Commerce Clause, as it imposed extraterritorial prohibitions on activities by Athena that have no relation to the state of California. The Federal Circuit directed the lower court to alter the scope of the injunction to only include Athena’s actions within California.

The case number is 2013-1286.

Attorneys: Mark Andrew Perry (Gibson, Dunn & Crutcher LLP) for Allergan, Inc., Murray A. Johnstone, M.D., and Duke University. Steven A. Zalesin (Patterson Belknap Webb & Tyler LLP) for Athena Cosmetics, Inc., Pharma Tech International, Inc., Product Innovations, LLC, Northwest Cosmetic Laboratories, LLC, and R&G Business LLC.

Companies: Allergan, Inc.; Athena Cosmetics, Inc.; Duke University; Pharma Tech International, Inc.; Product Innovations, LLC; Northwest Cosmetic Laboratories, LLC; R&G Business LLC

MainStory: TopStory DrugBiologicalNews FDCActNews AdvertisingNews CosmeticNews ClinicalNews LabelingNews PreemptionNews PrescriptionDrugNews

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