Facts
- Drug “compounding” involves pharmacists or doctors combining or altering ingredients to create patient-specific medications.
- The Food and Drug Administration Modernization Act of 1997 added FDCA § 503A, exempting certain compounded drugs from standard FDA new-drug approval requirements if specified conditions were met.
- Two conditions restricted speech: compounded drugs had to be dispensed pursuant to “unsolicited” prescriptions, and providers could not advertise or promote compounding of any particular drug, class, or type of drug.
- Licensed pharmacies specializing in compounded drugs sought to enjoin enforcement of these advertising and solicitation restrictions, alleging unconstitutional limits on commercial speech.
- The district court granted summary judgment for the pharmacies, holding the restrictions invalid under the commercial-speech test of Central Hudson.
- The Ninth Circuit affirmed, concluding the Government failed to show the provisions directly advanced its interests and that less speech-restrictive alternatives were unavailable.
- The Supreme Court granted certiorari.
Issues
- Whether FDCA § 503A’s conditions barring advertising and solicitation related to compounded drugs violate the First Amendment protection for truthful, non-misleading commercial speech.
- Whether the Government showed the speech restrictions directly advanced substantial interests and were no more extensive than necessary under Central Hudson.
Decision
- The Supreme Court affirmed (5–4) and held the advertising and solicitation prohibitions unconstitutional restrictions on commercial speech.
- The Court treated the pharmacies’ speech as lawful and non-misleading, placing it within First Amendment protection.
- The Court accepted the Government’s interests as substantial but concluded the Government did not satisfy Central Hudson’s tailoring and fit requirements.
- The Court reasoned that the Government’s concern centered on limiting the volume and scale of compounding to protect the new-drug approval system, not on preventing deceptive advertising.
- The Court identified less speech-restrictive means to address the asserted harms, including limits on quantities produced, restrictions to patient-specific prescriptions rather than batch production, and recordkeeping, licensing, or inspection requirements.
- Justice Thomas concurred separately, indicating skepticism about the adequacy of Central Hudson for protecting commercial speech.
- Justice Breyer dissented (joined by the Chief Justice and two Justices), arguing Congress could reasonably conclude the speech limits were appropriately tailored to prevent compounding from becoming manufacturing that evades FDA oversight.
Legal Principles
- Truthful, non-misleading commercial speech about lawful activity is protected and is evaluated under the Central Hudson four-part framework.
- The Government must show (1) a substantial interest, (2) that the regulation directly advances that interest, and (3) that the restriction is not more extensive than necessary.
- When the Government can achieve its objectives through non-speech regulation or by restricting less speech, it must choose those means rather than suppress truthful information.
- Restrictions justified by fears that consumers will make poor choices if given truthful information receive heightened skepticism.
Conclusion
The Court invalidated FDCA § 503A’s advertising and solicitation conditions for compounded drugs because, despite substantial public-health interests, the Government failed to justify broad speech bans where more direct regulation of compounding practices could address the same concerns with less restriction on protected commercial speech.