23Supply chains are complex, and federal prosecutors have a variety of options to pursue criminal liability theories that can be lurking in a variety of places.Federal Prosecutors Can Also Bring Criminal Charges Against Supply Chain Actors Based on the Food, Drug, and Cosmetic Act (FDCA), Title 21 U.S.C. § 331Although not necessarily a tool to fight slave, forced, and child labor practices, another federal statute with criminal penalties, 21 U.S.C. § 331, punishes supply chain actors who transact in merchandise that would also violate Section 545.Specifically, Section 331 imposes liability not just for those who (i) introduce any adulterated or misbranded “food, drug, device, tobacco product, or cosmetic” into interstate commerce, but also those who (ii) receive such products, (iii) deliver them, (iv) proffer their delivery (whether commercially or otherwise), (v) are engaged in their manufacturing, or (vi) alter, mutilate, destroy, obliterate, or remove in “whole or any part of the labeling” of such products under certain conditions, among other options.For instance, below are four key provisions in Section 331 that illustrate how Section 331 can work alongside Sections 545 and 1589:The following acts and the causing thereof are prohibited:(a) Theintroduction or delivery for introduction into interstate commerce of any food, drug, device, tobacco product, or cosmetic that is adulterated or misbranded. . . . (c) The receipt in interst

We don’t write a lot on criminal cases, but published opinions in the Ninth Circuit involving the Food Drug and Cosmetic Act always catch our eye. In United States v. Marschall, No. 22-30048, 2023 WL 6135771 (9th Cir. Sept. 20, 2023) (to be published in F.4th), the Ninth Circuit held last week that some felony convictions for shipping misbranded drugs do not require proof of scienter, i.e., that the defendant knew that the drugs he or she shipped were misbranded. Felony convictions are a big deal, and felony convictions without proof of intent or even knowledge are an even bigger deal.In our universe of drug and device litigation, you might ask, Why do we care? We care because the FDCA provision at issue is 21 U.S.C. § 331, which prohibits (among other things) the introduction into interstate commerce any drug that is adulterated or misbranded. In addition to criminal enforcement, the Act also provides for civil enforcement of Section 331, and the government’s view of “misbranded” drugs can be awfully broad. The FDA’s prohibition on off-label promotion, for example, is based purportedly on Section 331, on the theory that a drug promoted for one, unapproved purpose is “misbranded” because its label describes another.So we read the Marschall case and its treatment of misbranding with some interest. The defendant was a “naturopathic doctor” (which is new to us, but apparently is a licensed professional who treats patients using mainly natural remedies) who had a prior misdemeanor conviction for selling misbranded drugs. Id. at *2. That is a key fact, because when he did it again, the government was able to charge him with a felony under a provision of FDCA reserved for recidivists. (By the way, although no

[9] Rivas acknowledged that at least 10 individuals were sickened.[10]Rivas pled guilty to one felony count of introducing an adulterated food product into the stream of commerce with the intent to defraud, in violation of 21 U.S.C. §§ 331(a) and 333(a)(2), because he knowingly distributed cheese products in interstate commerce from inventory that he knew had tested positive for the presence of listeria.[11] Rivas also pled guilty to a strict liability misdemeanor offense, pursuant to 21 U.S.C. §§ 331(a) and 333(a)(1).

Section 301(k) of the FDC Act prohibits “the doing of any . . . act with respect to . . . [a] drug [or] device . . . if such act is done while such article is held for sale . . . after shipment in interstate commerce and results in such article being adulterated.” 21 U.S.C. § 331(k). A product is adulterated if, inter alia, it “has been prepared, packed, or held under insanitary conditions whereby it may have been contaminated with filth, or whereby it may have been rendered injurious to health.”

In 2014, Las Vegas urologist, Dr. Michael Kaplan, was convicted by a federal jury for reusing single-use plastic needle guides during prostate biopsies. He was convicted of conspiracy to commit adulteration in violation of the Federal Food, Drug, and Cosmetic Act (“FDCA”), 21 USC Section 331(k) with the intent to defraud or mislead, and sentenced to 4 years in prison. The background of the case began in 2010 when Dr. Kaplan’s office ran out of reusable needle guides for prostate biopsies.

Notably, the FDCA does not expressly prohibit the promotion or marketing of drugs for off-label use, and the FDA does not prohibit doctors from lawfully prescribing FDA-approved drugs for off-label uses. Nonetheless, the FDA has taken the position that manufacturers who market or promote an approved drug for an unapproved or off-label use may be held criminally liable for "misbranding" under 21 U.S.C. § 331(a). Section 331(a) prohibits "[t]he introduction or delivery for introduction into interstate commerce of any food, drug, device, tobacco product, or cosmetic that is adulterated or misbranded."

In recounting the statutory and regulatory background, FDA explains that it could consider such evidence to violate federal statutes or regulations in three ways:First, “if the claim is made in ‘labeling’ and establishes a new intended use, Vascepa would be considered an unapproved new drug with respect to that intended use, and distribution of Vascepa for that unapproved new use would therefore be prohibited. 21 U.S.C. §§ 331(d), 355(a), 321(g), (m) & (p).”Second, evidence of a new intended use “may also establish a violation of the FDCA’s misbranding provisions” because a drug is misbranded if “it lacks adequate directions for all intended uses, and the interstate distribution of misbranded products is illegal. See 21 U.S.C. §§ 331(a), (b), (c), (g) & (k).”Third, “to the extent any of Amarin’s communications, when taken in context, are misleading,” they might constitute “‘false or misleading’ labeling, rendering Vascepa misbranded” under 21 U.S.C. § 352(a), and its distribution in interstate commerce prohibited, 21 U.S.C. §§ 331(a), or might “constitute advertising that is ‘false, lacking in fair balance, or otherwise misleading,’” and thus misbranded under 21 C.F.R. § 202.1(e)(6), 21 U.S.C. § 352(n), and 21 U.S.C. § 321(n).

Further, they are “new drugs” within the meaning of section 201(P) of the Act [21 U.S.C. § 321(P)] because they are not generally recognized as safe and effective for use under the conditions prescribed, recommended, or suggested in their labeling. Under sections 301 (a) and (d) and 505(a) of the Act [21 U.S.C. §§ 331(a), (d) and 355(a)], a new drug may not be introduced into or delivered for introduction into interstate commerce unless an FDA approved application is in effect for the drug. Based on our information, you do not have any FDA-approved applications on file for these drug products.

llenges—affirming the district court’s decisions on both conviction and sentencing.OverviewThe Food, Drug and Cosmetic Act imposes several restrictions and prohibitions on the marketing of medical devices and other products regulated by the U.S. Food and Drug Administration (FDA). While many enforcement actions under the FDCA are civil in nature, the statute also includes provisions for criminal enforcement. Notably for purposes of this case, the “introduction or delivery for introduction into interstate commerce of any . . . device . . . that is adulterated or misbranded,” is a strict-liability misdemeanor offense under the statute, meaning that evidence of intent is not required to sustain a conviction. In cases involving evidence of intent, federal prosecutors can pursue felony charges.As determined by the district court, the appellants violated the FDCA’s prohibition on introducing adulterated and misbranded medical devices into the market. As the Court of Appeals explained, under 21 U.S.C. § 331(a):"A device is adulterated or misbranded if its ‘intended use’ -- as determined objectively by the seller's statements and conduct -- differs from the use(s) for which the FDA has cleared it."At trial, the district court found that the appellants violated § 331(a) by internally and externally promoting one of their company’s devices for uses not cleared by the FDA, i.e., off-label use. While practitioners “may lawfully prescribe and administer a device for an off-label use as long as that device has received § 510(k) clearance for any intended use,” manufacturers are prohibited from promoting their devices off-label.This was the crux of the case at trial, and the district court concluded that the former executives’ efforts to train internal personnel regarding off-label use promotion and encourage off-label use by practitioners (among other acts) were sufficient to constitute misdemeanorviolations of the FDCA. The Court of Appeals disagreed with the appellants’ arguments for reversal an

deral regulation of CBD by the FDA. In September 2022, Reps. Brett Guthrie (R-KY) and Morgan Griffith (R-VA)—now chairs of the House Energy and Commerce Committee Health Subcommittee and Oversight & Investigations Subcommittee, respectively—sent a letter urging the agency to establish clear regulatory standards for CBD and CBD-derived products. Sen.Wyden (D-OR) also has raised concerns about the current regulatory uncertainty around CBD. The latest announcement from the FDA is expected to further heighten congressional focus in this area. While it remains uncertain how Congressional interest may translate into legislative action, it is certain that stakeholders will be watching for any legislative developments as the 118th Congress continues to unfold. The agency has also previously stated that CBD’s status as an active ingredient in an FDA-approved drug means that it does not comply with the definition of a dietary supplement. See also, 21 U.S.C. § 321(ff)(3)(B) (dietary supplement); 21 U.S.C. § 331(ll) (food additive). 21 U.S.C. § 331(ll)(2). The FDA has also acknowledged that ingredients derived from cannabis that do not contain CBD or THC may be able to be used in foods and dietary supplements. For example, in 2018 the FDA determined that hulled hemp seed, hemp seed protein powder, and hemp seed oil (all derived from hemp seeds) were safe for human consumption. In late 2022, President Biden instructed the FDA and the Department of Health and Human Services to review the current listing policy for marijuana.