Genus Medical Technologies LLC v. United States Food and Drug Administration ( 2019 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
GENUS MEDICAL TECHNOLOGIES,
LLC,
Plaintiff,
v. Civil Action No. 19-544 (JEB)
UNITED STATES FOOD AND DRUG
ADMINISTRATION,
Defendant.
MEMORANDUM OPINION
Those drinking the contrast agent Vanilla SilQ before undergoing an X-ray or other
imaging procedure likely spend no time pondering the central issue in this case: is this barium-
sulfate product a drug or is it a medical device?
Plaintiff Genus Medical Technologies, LLC manufactures Vanilla SilQ products — a line
of contrast agents that are used to image structures or fluids within the body. Defendant Federal
Drug Administration has authority to regulate medical products like Genus’s to assure their
safety and efficacy. Under the Federal Food, Drug, and Cosmetic Act (FDCA), the agency can
regulate products as, inter alia, drugs or devices. The regulatory path the FDA chooses — that
is, whether it treats a product as a drug or a device — implicates significantly different pre-
market review and post-market compliance requirements under the Act and implementing
regulations. Drugs are subject to a more rigorous regimen, which costs its sponsor considerably
more money.
The FDA here concluded that although the Vanilla SilQ products appeared to qualify as
devices under the FDCA, they were also drugs and could be regulated accordingly. Plaintiff
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responded with this suit, and the parties have now cross-moved for summary judgment. Finding
the agency’s action to be inconsistent with the Administrative Procedure Act and the FDCA, the
Court will grant Plaintiff’s Motion for Summary Judgment and deny the FDA’s Cross-Motion.
I. Background
To provide context for the factual background, the Court first sets out the statutory
scheme.
A. Statutory Framework
The FDCA, 21 U.S.C. § 301 et seq., grants the FDA, as the designee of the Secretary of
Health and Human Services, the authority to regulate medical products, including “drugs” and
“devices.” Id. §§ 321(g)–(h), 393. The Act, in relevant part, defines “drug” to include:
articles intended for use in the diagnosis, cure, mitigation, treatment,
or prevention of disease in man or other animals.
Id. § 321(g)(1). It defines “device” in part, conversely, to mean:
an instrument, apparatus, implement, machine, contrivance,
implant, in vitro reagent, or other similar or related article, including
any component, part, or accessory, which is-- . . .
intended for use in the diagnosis of disease or other conditions, or in
the cure, mitigation, treatment, or prevention of disease, in man or
other animals, . . . and
which does not achieve its primary intended purposes through
chemical action within or on the body of man or other animals and
which is not dependent upon being metabolized for the achievement
of its primary intended purposes.
Id. § 321(h).
Comparing these definitions yields two conclusions that are relevant here: first, all FDA-
regulated diagnostic “devices” meet the “drug” definition. That is because of the overlap in the
intended-use portions of their definitions. Id. §§ 321(g)(1), (h) (drugs and devices both include
articles “intended for use in the diagnosis” of disease). Second, the critical difference between
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the two is that the device definition includes two exclusionary clauses. Specifically, a device,
unlike a drug, neither achieves “its primary intended purposes through chemical action within or
on the body of man” nor is “dependent upon being metabolized for the achievement of its
primary intended purpose.” § 321(h); see also ECF No. 17 (Joint Appendix (JA)) at FDA213
(FDA guidance refers to these portions as “exclusionary clauses”).
1. Regulatory Schemes
The statutory distinctions between a drug and a device have meaningful and practical
consequences. For starters, the FDA has established separate bureaucratic centers that oversee
the pre-market review and post-market regulation of drugs as opposed to devices. The Center for
Drug Evaluation and Research (CDER) has primary jurisdiction over drugs, while the Center for
Devices and Radiological Health (CDRH) has primary jurisdiction over medical devices. See 21
C.F.R. § 3.5; Intercenter Agreement Between the Center for Drug Evaluation and Research and
the Center for Devices and Radiological Health, U.S. Food & Drug Admin. (Oct. 31, 1991),
https://www.fda.gov/combination-products/classification-and-jurisdictional-
information/intercenter-agreement-between-center-drug-evaluation-and-research-and-center-
devices-and. Each center has its own requirements for marketing authorization.
To market new prescription drugs, for example, a sponsor — generally the
manufacturer — must submit a new-drug application demonstrating that the drug is safe and
effective for its proposed use. See 21 U.S.C. § 355(a)–(b). This process requires an extensive
series of safety and effectiveness trials before approval. Id. § 355(b). If the prospective drug is
the “same as” an existing drug already on the market, however, the sponsor can obtain approval
through the less onerous abbreviated new-drug application process. Id. § 355(j). This
abbreviated process requires proof that the drug in question has the same active ingredients,
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effects, and labeling as a predecessor drug that the FDA has already approved. Id.; 21 C.F.R.
§ 314.94(a).
By contrast, devices are reviewed and classified into three categories based on the risk
they pose to the public. Class I devices are low risk — i.e., they “present no unreasonable risk of
illness or injury” — and “are subject only to minimal regulations by ‘general controls.’”
Medtronic, Inc. v. Lohr, 518 U.S. 470, 476–77 (1996) (quoting 21 U.S.C. § 360c(a)(1)(A)).
Class II devices “are potentially more harmful”: “[A]lthough they may be marketed without
advance approval, manufacturers of such devices must comply with federal performance
regulations known as ‘special controls.’” Id. at 477 (quoting 21 U.S.C. § 360c(a)(1)(B)). Lastly,
high-risk devices are designated as Class III. See 21 U.S.C. § 360c(a)(1)(C). To introduce a
new Class III device into the market, “the manufacturer must provide the FDA with a
‘reasonable assurance’ that the device is both safe and effective.” Medtronic, 518 U.S. at 477(quoting 21 U.S.C. § 360e(d)(2)). To provide a “reasonable assurance,” the manufacturer
undergoes a pre-market approval process, which requires “detailed information regarding the
safety and efficacy” of its device. Id.
Additionally, significant cost differences exist in both the development and the continued
sale of drugs and devices. Plaintiff avers that the cost of seeking clearance to market its products
as devices is estimated to be $60,000, whereas seeking approval to market them as drugs could
be over half a million dollars in addition to a continuing annual cost north of $186,000. See ECF
No. 9 (Plaintiff’s MSJ), Exh. 8 (Declaration of John E. Powers), ¶¶ 31–33.
2. Requests for Designation
When the classification of a product — viz., as a drug or a device — is unclear or in
dispute, a sponsor can file a request for designation (RFD) to obtain a formal, binding
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determination from the FDA as to the “classification of the product . . . or . . . the component of
the [FDA] that will regulate the product.” 21 U.S.C. § 360bbb-2(a). The relevant “components”
here include the CDRH — which, again, regulates devices — and the CDER — which regulates
drugs. Sponsors submit RFDs to the Office of Combination Products, which is part of the FDA’s
Office of the Commissioner. The Act requires OCP to respond to RFDs no later than 60 days
after they are filed. Id. § 360bbb-2(b). If it fails to do so, the classification or assignment
recommended by the sponsor becomes operative. Id. § 360bbb-2(c). A classification or
assignment made through the RFD process can be changed only with the sponsor’s written
consent or for “public health reasons based on scientific evidence.” Id. § 360bbb-2(b).
B. Factual History
Since 2015, Genus has manufactured “Vanilla SilQ” — a line of barium-sulfate oral-
solution contrast agents. See ECF No. 1 (Complaint), ¶ 25; JA at FDA8. These products are
“ingested for diagnostic purposes.” JA at FDA14. The physical and chemical properties of
barium sulfate — particularly its opacity — enable health-care providers to better visualize the
gastrointestinal tract when performing X-rays or computer tomography (commonly referred to as
a CT scan). Id. at FDA8. Significantly, because it is an inert metal salt, barium sulfate does not
chemically interact with human cells or tissue to serve its purpose. Id. Ingesting it does not
affect the chemical bonds or molecular structure of the gastrointestinal system or form new
substances. Id. at FDA8, FDA14. Further, when used as a contrast agent, it is “neither absorbed
nor metabolized” by the body. Id. at FDA15.
Genus maintains that before and after it started producing Vanilla SilQ, it sought FDA
clearance to distribute its products as devices. Id. at FDA55. Alternatively, Plaintiff purported
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to establish that — for reasons that are inapplicable here — its products were exempted from
drug regulation. Id. at FDA58, FDA135 (citing 21 U.S.C. § 321(p)(1)).
In June 2016, the FDA conducted a three-day inspection of Plaintiff’s distribution
facility. Id. at FDA134. On May 2, 2017, it issued a Warning Letter, notifying Genus that its
products were “drugs” within the meaning of the Act. Id. at FDA135 (citing 21 U.S.C.
§ 321(g)(1)). It further explained that because the products “are not generally recognized as safe
and effective for use under the conditions prescribed, recommended, or suggested in their
labeling,” they were also “new drugs” under the statute. Id. (citing 21 U.S.C. § 321(p)(1)). Such
a classification posed a significant problem for Genus. That is because new drugs may not be
introduced into interstate commerce without the FDA’s approval, see 21 U.S.C. §§ 331(d),
355(a)), which would require substantially more expense for Genus. See JA at FDA135. The
agency also warned Plaintiff that its products were misbranded — a separate violation of the
statute. Id. at FDA135–36 (citing 21 U.S.C. §§ 331(a), 352).
The Warning Letter prompted further correspondence between the parties. See, e.g., id.at FDA37 (Genus’s May 19, 2017, Response to Warning Letter); id. at FDA32 (FDA’s Sept. 6,
2018, Response to Warning Letter Response). In their letters, the parties chiefly disputed the
classification of Vanilla SilQ products. Genus, on the one hand, maintained that its products are
devices. Id. at FDA38–39. If so, several of the violations of the FDCA outlined in the Warning
Letter, as well as the Act’s drug-regulatory scheme, would be inapplicable. The FDA, on the
other hand, stated that the products met the drug definition and could be regulated accordingly.
Id. at FDA32–35.
With the parties at an impasse, Genus submitted an RFD, requesting that OCP classify its
Vanilla SilQ products as devices. Id. at FDA17. In its response, OCP noted that Plaintiff’s
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products “meet the definition of drug” and “also appear to meet the definition of ‘device.’” JA at
FDA1–3 (Jan. 10, 2019, Designation Letter). For reasons that will be set out in more detail, OCP
nevertheless concluded that Vanilla SilQ products are drugs to be regulated by CDER. Id. at
FDA1. In short, the agency reasoned that it must regulate contrast agents — which all meet the
definition of drugs, but not necessarily devices — uniformly. Id. at FDA3.
On February 28, 2019, Genus filed suit in this Court. It challenges the FDA’s decision to
regulate Vanilla SilQ products as drugs rather than as medical devices on a number of different
grounds, including that it was arbitrary and capricious, as well as in excess of statutory authority,
thus violating the FDCA via the APA. See Compl., ¶¶ 46–55. Plaintiff has now moved for
summary judgment, seeking, inter alia, a declaration requiring the FDA to regulate its products
as devices. See Pl. Mot. at 2. Defendant, for its part, has countered with its own Motion for
Summary Judgment, seeking affirmation of its classification decision.
II. Legal Standard
Although styled Motions for Summary Judgment, the pleadings in this case more
accurately seek the Court’s review of an administrative decision. The summary-judgment
standard set forth in Federal Rule of Civil Procedure 56(c), therefore, “does not apply because of
the limited role of a court in reviewing the administrative record.” Sierra Club v. Mainella, 459
F. Supp. 2d 76, 89 (D.D.C. 2006). “[T]he function of the district court is to determine whether
or not as a matter of law the evidence in the administrative record permitted the agency to make
the decision it did.” Id. at 90 (quoting Occidental Eng’g Co. v. INS, 753 F.2d 766, 769–70 (9th
Cir. 1985)). “Summary judgment is the proper mechanism for deciding, as a matter of law,
whether an agency action is supported by the administrative record and consistent with the APA
standard of review.” Loma Linda Univ. Med. Ctr. v. Sebelius, 684 F. Supp. 2d 42, 52 (D.D.C.
2010).
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The APA “sets forth the full extent of judicial authority to review executive agency
action for procedural correctness.” FCC v. Fox Television Stations, Inc., 556 U.S. 502, 513
(2009). It requires courts to “hold unlawful and set aside agency action, findings, and
conclusions” that are “arbitrary, capricious, an abuse of discretion, or otherwise not in
accordance with law.” 5 U.S.C. § 706(2). Agency action is arbitrary and capricious if, for
example, the agency “entirely failed to consider an important aspect of the problem, offered an
explanation for its decision that runs counter to the evidence before the agency, or is so
implausible that it could not be ascribed to a difference in view or the product of agency
expertise.” Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S.
29, 43 (1983).
III. Analysis
In bringing its suit here, Plaintiff preliminarily maintains that the FDA’s response to its
RFD was deficient because it failed to actually classify the products — that is, as drugs or
devices. As a result, Genus believes that the agency must now accept its recommendation and
classify Vanilla SilQ products as devices. Alternatively, and more substantively, it argues that
even if the agency’s response was not deficient, the decision to regulate the products as drugs
rather than devices violates the APA as arbitrary and capricious agency action taken in
contravention of the FDCA. The Court considers each of these positions in turn.
A. Designation Letter
Genus first contends that Defendant skirted its statutory responsibility by providing a
deficient RFD response. See Pl. Mot. at 21–22. OCP observed that Vanilla SilQ barium-sulfate
products “meet the definition of drug,” while “also appear[ing] to meet the definition of
‘device.’” JA at FDA2–3. It nonetheless concluded that it was appropriate for the CDER to
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review and regulate these products as drugs. Id. at FDA1. Plaintiff points out that the agency’s
letter failed to use “the word ‘classify’ or ‘classification’ [as] applied to Vanilla SilQ.” Pl. Mot.
at 21. By neglecting to do so, the argument goes, OCP violated its statutory obligation to
“provide a ‘written statement that identifies such classification.’” Id. at 22–23 (emphasis added)
(quoting 21 U.S.C. § 360bbb-2(b). And the consequence of not providing a timely determination
is that the sponsor’s recommendation — here, that Vanilla SilQ products should be regulated as
devices — becomes operative. See 21 U.S.C. § 360bbb-2(c).
Genus’s semantics argument stretches too far. Contrary to its suggestion, the Act does
not have a “magic words” requirement — that is, the agency need not use any specific terms in
designating a product. Instead, the FDCA simply requires that the FDA, within 60 days of
receiving an RFD, “determine the classification of the product . . . or . . . the component of the
[FDA] that will regulate the product,” and then “provide to the person a written statement that
identifies such classification or such component, and the reasons for such determination.” Id.
§ 360bbb-2(b) (emphases added). The FDA’s designation letter here does just that. The agency
reasoned that Vanilla SilQ products are drugs, and its letter spells out that the CDER is the
proper component to regulate them. See JA at FDA1–5. As such, the Court can make quick
work of Genus’s first contention and find that the FDA’s letter easily passes muster under
§ 360bbb-2(b).
B. APA/FDCA Violations
The harder question relates to Plaintiff’s claim that the FDA’s designation of its products
as drugs rather than devices contravened the FDCA. On this score, Genus focuses on the
exclusionary clauses in the device definition. See Pl. Mot. at 24; ECF No. 12 (Plaintiff’s
Opposition and Reply) at 2. Specifically, it notes that a device, unlike a drug, “does not achieve
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its primary intended purposes through chemical action within or on the body of man or other
animals” or through “being metabolized for the achievement of its primary intended purposes.”
Pl. Mot. at 24 (quoting 21 U.S.C. § 321(h)). In Plaintiff’s telling, the record makes clear that its
products do not operate this way, so the plain text directs the FDA to regulate Vanilla SilQ as a
device rather than a drug. Id. at 26 (citing JA at FDA3, FDA6–21). Interpreting the language
any differently would, according to Plaintiff, read out the exclusionary clauses entirely and
nullify Congress’s intent to create two separate regulatory tracks for devices and drugs. Id. at
22–28.
In response, the agency argues that the fact that Plaintiff’s products “appear to meet the
definition of ‘device’” does not end the matter. See ECF No. 10 (Def. Cross-MSJ) at 2 (quoting
JA at FDA3). Because “the definitions of drug and device are overlapping, rather than mutually
exclusive,” JA at FDA3 — i.e., because both are defined as “articles intended for use in the
diagnosis of disease,” 21 U.S.C. §§ 321(g)(1), (h) — Defendant contends that it has discretion to
decide how to regulate a diagnostic product that falls within both categories. See Def. Cross-
MSJ at 19–20; ECF No. 14 (Def. Reply) at 5–6.
With that backdrop, the Court tees up the issue: did Congress grant the agency the
discretion to regulate any medical diagnostic device as a drug?
1. Legal Framework
To tackle this question, the Court turns to Chevron’s familiar framework. See Chevron
U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984); see also, e.g., Shays v. FEC,
414 F.3d 76, 96 (D.C. Cir. 2005) (outlining Chevron framework); Republican Nat’l Comm. v.
FEC, 76 F.3d 400, 404 (D.C. Cir. 1996). Under Chevron, the first step is to “examine the statute
de novo, ‘employing traditional tools of statutory construction.’” National Ass’n of Clean Air
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Agencies v. EPA, 489 F.3d 1221, 1228 (D.C. Cir. 2007) (quoting Chevron, 467 U.S. at 843 n.9);
see also Mount Royal Joint Venture v. Kempthorne, 477 F.3d 745, 754 (D.C. Cir. 2007) (court
begins by “applying customary rules of statutory interpretation”). Courts consider “whether
Congress has ‘unambiguously foreclosed the agency’s statutory interpretation.’” Vill. of
Barrington v. Surface Transp. Bd., 636 F.3d 650, 659 (D.C. Cir. 2011) (quoting Catawba Cty. v.
EPA, 571 F.3d 20, 35 (D.C. Cir. 2009)). “Congress may have done so . . . either by prescribing a
precise course of conduct other than the one chosen by the agency, or by granting the agency a
range of interpretive discretion that the agency has clearly exceeded.” Id. At this stage, courts
afford an agency’s interpretation no special deference: “[I]f the agency has either violated
Congress’s precise instructions or exceeded the statute’s clear boundaries then, as Chevron puts
it, ‘that is the end of the matter’ — the agency’s interpretation is unlawful.” Id. at 660 (quoting
Chevron, 467 U.S. at 842); see also Eagle Broad. Grp., Ltd. v. FCC, 563 F.3d 543, 552 (D.C.
Cir. 2009) (if the “search for the plain meaning of the statute . . . yields a clear result, then
Congress has expressed its intention as to the question, and deference is not appropriate”)
(quoting Bell Atlantic Tel. Cos. v. FCC, 131 F.3d 1044, 1047 (D.C. Cir. 1997)).
If, however, “the statute is silent or ambiguous with respect to the specific issue,”
Chevron, 467 U.S. at 843, the analysis proceeds to “determine the deference, if any, [the court]
owe[s] the agency’s interpretation of the statute.” Kempthorne, 477 F.3d at 754. Under this
step, “[i]f Congress has explicitly left a gap for the agency to fill, there is an express delegation
of authority to the agency to elucidate a specific provision of the statute by regulation. Such
legislative regulations are given controlling weight unless they are arbitrary, capricious, or
manifestly contrary to the statute.” Chevron, 467 U.S. at 843–44. When a “legislative
delegation to an agency on a particular question is implicit rather than explicit,” id. at 844, the
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Court must uphold any “‘reasonable interpretation made by the administrator’ of that agency.”
Am. Paper Inst., Inc. v. EPA, 996 F.2d 346, 356 (D.C. Cir. 1993) (quoting Chevron, 467 U.S. at
844).
2. Chevron Step One
At the first step, the Court must use the “customary statutory interpretation tools of ‘text,
structure, purpose, and legislative history’” to determine whether Congress’s intent regarding the
FDCA is clear. California Metro Mobile Commc’n, Inc. v. FCC, 365 F.3d 38, 44–45 (D.C. Cir.
2004) (quoting Consumer Elecs. Ass’n v. FCC, 347 F.3d 291, 297 (D.C. Cir. 2003)).
The Court thus begins “where all such inquiries must begin: with the language of the
statute itself.” Caraco Pharm. Labs., Ltd. v. Novo Nordisk A/S, 566 U.S. 399, 412 (2012)
(quoting United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241 (1989)). As set out above, the
FDCA provides for classification of a diagnostic product as, inter alia, a drug or a device. The
intended-use provision is common to both, while the definition of device excludes products that
undergo chemical reactions within the body or are metabolized to perform their primary intended
purposes. See 21 U.S.C. §§ 321(g)(1), (h).
In determining which of these definitions controls, the Court is guided by the “old and
familiar rule” that “the specific governs the general.” RadLAX Gateway Hotel, LLC v.
Amalgamated Bank, 566 U.S. 639, 645 (2012) (quoting Morales v. Trans World Airlines, Inc.,
504 U.S. 374, 384 (1992)). Here, there is no dispute about which definition is more specific:
Congress, as both parties agree, more narrowly defined devices. See JA at FDA212 (FDA
Guidance) (characterizing device definition as “more restrictive”). There is good reason for that
more specific definition to govern in this dispute. That is, a product that falls within both
definitions is more appropriately classed as a device, else the device definition would be
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“swallowed” by the more general drug definition. See RadLAX Gateway Hotel, 566 U.S. at
645; accord Bloate v. United States, 559 U.S. 196, 207 (2010) (“[G]eneral language of a
statutory provision, although broad enough to include it will not be held to apply to a matter
specifically dealt with in another part of the same enactment.”) (quoting D. Ginbserg & Sons,
Inc. v. Popkin, 285 U.S. 204, 208 (1932)).
Put differently, adopting an interpretation in which a diagnostic product is a drug — even
if it plainly falls under the device definition — would read out the exclusionary clauses
altogether. That result would be at odds with the way courts ordinarily interpret statutes —
namely, they attempt to give effect to all their provisions, “so that no part will be inoperative or
superfluous, void or insignificant.” Corley v. United States, 556 U.S. 303, 314 (2009) (quoting
Hibbs v. Winn, 542 U.S. 88, 101 (2004); then quoting 2A N. Singer, Statutes and Statutory
Construction § 46.06, 181–86 (rev. 6th ed. 2000)).
What is more, the exclusionary clauses would not be the only casualties under the
agency’s reading. If a product that meets both definitions is nonetheless treated as a drug, then
the device-drug distinction would be rendered meaningless. Put otherwise, the FDA could
classify any diagnostic device as a drug because no limiting principle would trammel its
authority. That would turn the statutory scheme on its head. See K Mart Corp. v. Cartier, Inc.,
486 U.S. 281, 291 (1998) (“In ascertaining the plain meaning of the statute, the court must look
to the particular statutory language at issue, as well as the language and design of the statute as a
whole.”). As set out above, supra Section I.A.1, Congress erected entirely different statutory and
regulatory compliance regimes for drugs and devices, including separate systems for registration,
market authorization, regulation, and reporting requirements. Compare, e.g., 21 U.S.C. §§ 355,
355b, 360(h)(3) (drugs), with id. §§ 360(h)(2), 360(k), 360c, 360e (devices). Were Defendant
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able to decide whether to regulate any device as a drug, it could then subvert this dual-track
scheme at will. This Court cannot countenance such an outcome. See RadLax Gateway Hotel,
566 U.S. at 645 (instructing that “effect shall be given to every clause and part of the statute”)
(quoting D Ginsberg & Sons, 285 U.S. at 208).
In the end, the plain text dictates the result here. Congress readily could have afforded
the agency discretion to determine which of these pathways a product must take. It in fact has
done so with respect to agency decisions under other parts of the FDCA. See, e.g., 21 U.S.C.
§§ 360c(a)(3)(A), 360c(a)(3)(B), 360d(a)(1), 360bbb-3(i), 379(h)(a)(1)(G) (granting FDA
discretion to varying degrees). But it did not do so here. See Whitman v. Am. Trucking Ass’n,
531 U.S. 457, 468 (2001) (“Congress . . . does not alter the fundamental details of a regulatory
scheme in vague or ancillary provisions — it does not, one might say, hide elephants in
mouseholes.”). Because “courts must presume that a legislature says in a statute what it means
and means in a statute what it says there,” the Court holds that a product that meets the device
definition must be regulated as such. See Conn. Nat’l Bank v. Germain, 503 U.S. 249, 252–53
(1992). The Court accordingly ends its analysis at Chevron step one.
3. Other Arguments
Not ready to throw in the towel, Defendant offers a number of other reasons why the Act
grants it discretion to classify Vanilla SilQ products as drugs or, at the very least, is more
ambiguous on this front than appears at first blush. None is persuasive.
a. Drafting History
The agency first points to evidence that Congress removed language from an earlier
version of the FDCA that specifically excluded devices from the definition of drugs. See Pl.
Mot. at 2, 10, 23. Because the statute now apparently contains definitional overlap, Defendant
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argues that Congress implicitly vested the FDA with discretion “to determine the appropriate
regulatory regime . . . when a product satisfies both definitions.” Id. at 2. The Court disagrees.
Because this legislative amendment was aimed at an entirely different problem — to wit,
facilitating a regulatory track for so-called “combination products” — it cannot shoulder the
weight that Defendant places on it.
Some background is in order. For several years, the Act specified that a drug “does not
include devices or their components, parts, or accessories.” 21 U.S.C. § 321(g) (1938); see also
United States v. Article of Drug, Bacto-Unidisk, 394 U.S. 784, 793 (1963) (“a ‘device’ expressly
cannot be a ‘drug’ under the last phrase of the drug definition”). That changed in 1990 when
Congress amended the Act and removed the exclusion of devices from the definition of drug.
See Safe Medical Device Act of 1990, Pub. L. No. 101–629, 104 Stat. 4511, 4526 (“[i]n
paragraph (g)(1), by striking out ‘; but does not include devices or their components, parts or
accessories’”).
Significantly, in the same amendment, Congress added another category of medical
products — “combination products” — to the FDA’s regulatory plate. See 104 Stat. at 4526
(codified as amended at 21 U.S.C. § 353(g)). A combination product comprises two or more
“regulated components,” such as a drug component and a device component, that are “produced
as a single entity.” 21 C.F.R. § 3.2(e)(1). Take, for example, a surgical mesh with anesthetic
coating, which has a device component (the mesh) and a drug component (the anesthetic). The
FDA reviews a combination product according to its “primary mode of action.” 21 U.S.C.
§ 353(g). Put simply, it will regulate a product depending on which constituent part — e.g.,
device or drug — is most responsible for its intended use. (Genus, it should be noted, does not
contend that Vanilla SilQ are combination products. See Pl. Mot. at 16.)
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The provision excluding devices from the drug definition, therefore, was removed to
enable combination drug/device products to be regulated as drugs in appropriate cases. See S.
Rep. No. 101–513, at 43 (1990) (“Section 19 alters the drug and device definitions in [§ 321].
Language is removed from the drug definition that will permit an approval of a drug/device
combination.”) (emphasis added); id. at 30 (“By deleting this language, a product whose primary
mode of action is attributable to a drug, but has a device component, may be reviewed under the
Act’s drug authority.”). Congress’s intent was not — as the FDA would have the Court believe
— to delegate unfettered discretion to the FDA to regulate all devices as drugs.
Congress, moreover, did not alter the essential nature of the device regulatory regime —
a framework that has been in place since 1976. See Medical Device Amendment of 1976, Pub.
L. No. 94–295, 90 Stat. 539 (1976) (establishing device regulatory regime). Notably, legislative
history surrounding the implementation of this scheme makes clear that Congress intended the
FDA “to classify all medical devices intended for human use into three regulatory categories
(classes) based upon the extent of control necessary to insure the safety and efficacy of each such
device.” H.R. Rep. No. 94–853, at 3 (1976) (emphasis added). Indeed, the House Committee
Report notes that “[t]here is an apprehension that medical devices have not been clearly
delineated from drugs and that legislation directing regulation of devices by the same system
currently used for drugs would be inappropriate.” Id. at 11. That the 1990 amendment left the
device regulatory scheme largely intact evidences Congress’s intent for the FDA to regulate
drugs and devices using the exclusionary clauses as a dividing line.
The agency also calls attention to the definition of contrast agents as drugs in recently
enacted legislation. See 21 U.S.C. § 360j(p)(4)(B) (“the term ‘contrast agents’ means a drug that
is approved under section 355 of this title or licensed under section 262 of [the Public Health
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Service Act”); Def. Cross-Mot. at 22 n.5. But this argument, too, misses the mark. This
definition of contrast agent operates solely for “the purposes of this subsection.” 21 U.S.C.
§ 360j(p)(4) (emphasis added). And this subsection concerns the FDA’s approval of medical-
imaging devices that use a contrast agent in a manner different from that in the agent’s labeling.
Id. If the FDA were correct that Congress intended that this definition should control the entirety
of contrast agents, the “for purposes of this subsection” language would be superfluous. In brief,
§ 360j(p)(4)(B) does not support the regulation of all contrast agents as drugs or even all contrast
agents for use with medical-imaging devices as drugs. Rather, this provision underscores that
some contrast agents for use with medical-imaging devices are regulated as drugs.
b. Caselaw
Defendant’s position gains no traction from the principal cases on which it relies. Start
with Bacto-Unidisk — a 1963 decision that involved a challenge to the agency’s decision to
regulate a product as a drug, rather than as a device. See 394 U.S. at 789–91. The Supreme
Court ruled in favor of the agency, finding that the product fell within the definition of drug. Id.
at 792–93. In doing so, it explained that “Congress fully intended that the Act’s coverage be as
broad as its literal language indicates,” and “remedial legislation such as the [Act]” must be
afforded a “liberal construction.” Id. at 798. The Court also observed an “obvious area of
overlap” that at the time existed between the drug and device definitions, id. at 799 — an
observation Defendant emphasizes to conclude that even when a product possibly meets the
device definition, the agency has discretion to regulate it as a drug. See Def. Reply at 7–8.
Not so fast. To begin, the decision was issued in an era when devices were not subject to
pre-market testing. See Bacto-Unidisk, 394 U.S. at 785. The only way to ensure the safety and
efficacy of the product and subject it to pre-market authorization requirements was to classify it
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as a drug. Id. at 784–85, see id. at 798 (given “the Act’s overriding purpose to protect the public
health . . . [and] to ensure that antibiotic products marketed serve the public with ‘efficacy’ and
safety,’” Court liberally construed term “drug”). That, of course, changed when, in 1976,
Congress amended the Act to introduce a comprehensive device regulatory regime. See 90 Stat.
at 539 (1976) (amending Act “to provide for the safety and effectiveness of medical devices
intended for human use”).
In tandem with these changes, Congress beefed up the device definition itself. At the
time Bacto-Unidisk was decided, the definition contained an earlier version of the intended-use
language. See 394 U.S. at 789–90 (“intended for use in the diagnosis . . . of disease in man”).
Congress later defined devices as products that did not achieve their “principal intended
purpose” through chemical interaction with the body or through metabolization. See 90 Stat. at
575; see also 104 Stat. at 4526 (1990) (then amending “principal” to “primary”). It is no surprise
that the Supreme Court recognized that the language of the statute as it then existed was “of little
assistance in determining precisely what differentiates a ‘drug’ from a ‘device.’” Bacto-Unidisk,
394 U.S. at 799. For the reasons set out above, however, this is plainly no longer true. The
Court concludes, accordingly, that the logic in Bacto-Unidisk does not decide the issue here.
Similarly, Bracco Diagnostics, Inc. v. Shalala, 963 F. Supp. 20 (D.D.C. 1997), does not
carry the day for the agency. The district court there considered whether the FDA’s disparate
treatment of two “functionally indistinguishable” products — i.e., one was regulated as a device
while another as a drug — was arbitrary and capricious. Id. at 24, 28. It answered this question
in the affirmative, finding it problematic for the agency to apply two different regulatory
frameworks to essentially identical products. Id. at 24, 27–28. In its analysis, the court also
stated: “[The products at issue] all likely meet both the definition of a drug and the definition of a
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device under the [Act], and the FDA therefore has discretion in determining how to treat them.”
Id. at 28 (citing 21 U.S.C. § 353(g)).
So, Defendant argues, when a product meets the definition of both drugs and devices, the
agency has discretion to decide into which category to place them. See Def. Cross-Mot. at 15,
23. The agency also believes that Bracco supports its decision to regulate all contrast agents —
regardless of whether any one of them meets the device definition — as drugs for the sake of
uniformity. Id. at 11–14; JA at FDA3 (“Because not all contrast agents meet the definition of a
device, but all of them do meet the definition of a drug, the agency has for many years regulated
these products . . . as drugs in order to regulate them consistently under the same authority.”).
As a result, Defendant maintains that its position with respect to Genus is neither arbitrary nor
capricious. Id. at 15; see JA at FDA3 n.5.
Bracco, however, is less helpful to the FDA than it initially appears. To be sure, it holds
that an agency acts unlawfully when it treats differently products that are the same in all material
respects. Such holding, however, arose on a motion for preliminary injunction and was not a
final merits ruling. See 963 F. Supp. at 22. The injunction simply prohibited the FDA from
proceeding with approval of the plaintiff’s product as a device until after it had resolved a
citizen’s petition addressing whether the agency could treat as a device a product the other
manufacturers of which had received approval to market as a drug. Id. at 23. The court left it to
the FDA to decide whether the FDCA entitled the plaintiff to proceed under § 353 as a device,
which is, of course, the heart of the matter here. Id. at 27–28. In addition, although Bracco
states that the FDA has the “discretion” to decide how it treats contrast agents, it points to
§ 353(g), which confers the authority to regulate combination products — products that are not at
issue here. Id. at 28.
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It is also notable that Congress further amended the FDCA after Bracco was decided in
the Federal Food and Drug Administration Modernization Act of 1997 and did so in ways that
reduced the administrative burden on device manufacturers. Nothing in the 1997 amendments
betrays a Congressional intent to force a device manufacturer to tread a more difficult or
demanding path to market than what the characteristics of its device would require, even though
doing so might be administratively “efficient” for the FDA.
Plaintiff, finally, is not maintaining that similarly situated products should receive
disparate treatment. Rather, it posits that not all contrast agents are the same. Because the
Vanilla SilQ products, unlike other contrast agents, do not chemically interact with the body,
they should be treated as devices. See Pl. Reply at 27–28. In sum, Bracco does not suggest that
the FDA can ignore the plain language of the FDCA; it does not have discretion to regulate all
contrast agents uniformly, irrespective of their defining features under the statute.
IV. Conclusion
For these reasons, the Court will vacate Defendant’s decision to regulate Genus’s Vanilla
SilQ products as drugs and will remand to the agency for further administrative proceedings
consistent with this Opinion. A separate Order so stating will be issued this day.
/s/ James E. Boasberg
JAMES E. BOASBERG
United States District Judge
Date: December 6, 2019
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