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Court holds that pharmaceutical product placement may be a representation of product quality
James Keagy 894

Court holds that pharmaceutical product placement may be a representation of product quality

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On the Docket

David B. Brushwood, BSPharm, JD

Most states have consumer protection laws that authorize lawsuits against retailers who represent their products as having characteristics that the products actually do not have. Lawsuits alleging such misrepresentations can usually be pursued against retailers either by individual product purchasers or by nongovernmental public interest groups. A recent case from the District of Columbia reviewed allegations of unfair business practices against two retailers based on their placement of homeopathic remedies near the pharmacy area of their businesses.

Court holds that pharmaceutical product placement may be a representation of product quality

Background

The plaintiff was an organization with a stated mission “to foster a secular society based upon science, reason, freedom of inquiry, and humanist values.” The plaintiff alleged that “homeopathy is a pseudoscience and that the concepts on which it is based contradict the most fundamental understanding of science.”

According to the court, the plaintiff's lawsuit contains “numerous factual allegations and accompanying photographs to the effect that: the defendant retailers market themselves as offering products that will enable customers to get healthy; persons suffering an ailment will often turn to the pharmacy section of their neighborhood [retailer] for relief; studies and patient experience have shown that homeopathic products are not effective; [the retailers] present homeopathic products alongside FDA-approved over-the-counter products, under aisle signs indicating that the aisles contain remedies for pain, colds, heartburn, and other conditions; and the retailers do so without informing customers that there is no scientific evidence that homeopathic products have any value in treating these symptoms and diseases.”

The retailers moved to dismiss the lawsuit. The trial judge granted the motion to dismiss, ruling that the plaintiff had “failed to cite any pertinent scientific studies or legal authority that placing homeopathic products next to ‘science-based’ medicines is misleading to a reasonable consumer.”

The plaintiff appealed.

Rationale

The appellate court first noted that whether a trade practice is misleading is generally a question of fact for a jury, and not a question of law for a court.

The appellate court said, “we do not find it facially implausible that a reasonable customer could believe, based on [the retailers’] placement of homeopathic drug products alongside FDA-approved over-the-counter drugs, that homeopathic products are comparably efficacious.” The court agreed with the plaintiff that “whether signage and product placement influence consumers regarding the efficacy of medical products is a question that can be answered only with evidence and is not an inherently implausible assertion that can be dismissed out of hand.”

The court concluded that the plaintiff's factual allegations “plausibly support an inference that, through their product placement practices, [the retailers] misled consumers into believing that homeopathic products are equivalent alternatives to FDA-approved over-the-counter drugs.”

In reversing dismissal of the plaintiff's case against the retailers, the appellate court said, “we hold as a matter of law that the placement of a product can be a representation” under consumer protection laws.

Takeaways

As a result of this reversal on appeal, the case against the retailers will continue to trial unless it is settled out of court. The case itself has not yet been resolved. Yet an important point of law has been recognized by the appellate court. The placement of a product on pharmacy shelving can be legally interpreted as a representation, by the product seller to the product user, that the product has scientific value.

The court's ruling is a significant cautionary tale for pharmacies that stock products in ways that could be interpreted as misleading to purchasers. Based on this court's ruling, it would be prudent for pharmacies to

  • Stock homeopathic remedies and other alternative products separately from FDA-recognized OTC products.
  • Use signage that avoids any scientifically unsupportable claim of efficacy.
  • Explain to patients each product's purported mechanism of action, and facilitate patient choice based on complete understanding of the product.
  • Encourage patients to read all written information on labels affixed to products and in leaflets that accompany products.

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