Druggist loses bid to delay lawsuit
Cease warnings, judge tells FDA
Cantrell Drug Co. on Thursday lost its bid to delay a civil lawsuit the U.S. Food and Drug Administration filed against the compounding pharmacy over the quality of the drugs it manufactures and distributes.
U.S. Bankruptcy Judge Phyllis Jones also said in a 49-page order that the federal agency didn’t violate an automatic stay in Cantrell Drug’s bankruptcy case by filing the civil lawsuit or by distributing a news release to hospitals and medical professionals warning them to avoid using the company’s products while the agency seeks to stop their production and distribution.
The company has said the news release played a large role in the near-collapse of the company while it was in the midst of reorganizing its assets in bankruptcy.
Jones denied Cantrell’s request for an order requiring the FDA to retract or modify the news release, but she imposed a “temporary stay on the issuance of any future news releases or alerts.”
Cantrell Drug remained in business as of Thursday, said Steve Weintz, the company’s sales and marketing vice president.
“What was it Mark Twain said? ‘Rumors of my death have been greatly exaggerated!’” Weintz said in an email. “Seems to be the case here … to answer your question YES Cantrell Drug is very much in business and working hard to find a settlement with the FDA to continue operations.”
Weintz also called “unprecedented” Jones’ order that the FDA not “issue any more press releases that would adversely affect Cantrell Drug Company.”
Jones said the federal agency couldn’t issue anoth-
er news release until the civil case was resolved or some other agreement between the FDA and Cantrell Drug is reached.
Cantrell Drug manufactures and distributes injectable drugs primarily for hospitals. The company can produce, or compound, a range of drugs in individual doses for hospital use, which is less expensive than the hospitals compounding the drugs themselves.
Cantrell Drug often focuses on drugs, such as morphine sulphate, that are on the FDA’s critical shortage list, which generally means they aren’t readily available.
But the company has sparred with the FDA, which heightened its scrutiny of the industry after a deadly outbreak of fungal meningitis from compounded drugs provided by a pharmacy in Massachusetts in 2012. Congress the next year created a new regulatory regimen for Cantrell and similar 503B facilities.
The FDA said it has inspected the company’s facilities three times since 2013, the latest occurring in June 2017, and found several deficiencies in Cantrell Drug’s operations that led to unsanitary conditions, poor monitoring of the environment and lack of documentation, all of which called into question the quality and sterility of the drugs it produced.
The company sought bankruptcy protection in November to reorganize after the June inspection, two voluntary product recalls, temporary production shutdowns that upset its finances and continued concerns by the FDA.
The latter resulted in negotiations involving a consent agreement that would have closed the business for a period of time and, according to Cantrell Drug, put its future in jeopardy. After negotiations broke down, the Department of Justice and the FDA sued the company last month in U.S. District Court and sought a preliminary injunction to stop the company from producing and distributing its drugs.
The company then turned to Jones for relief. She held two days of hearings before Cantrell Drug and the FDA reached an agreement to stay the proceedings for two weeks to allow the company to continue production but not distribute its products. At the same time, the agreement allows the FDA to perform another inspection and issue what it calls a Form 483.
“Cantrell Drug has just completed an intensive thorough, and grueling inspection by the FDA,” Weintz said. “There has been no re-call of any existing Cantrell product.”
That inspection found some irregularities, but Jones said in her order that the company’s performance has improved since the 2017 inspection and, thus, eliminates the need for the FDA to issue any other releases or alerts.
“While there remain observations to address from the 2018 Form 483, to the layman’s eye the observations were much less serious than those identified in the June 2017 inspection,” Jones wrote. “In addition, there is a bona fide dispute between the parties regarding the observations and the standards that apply to 503B facilities.
“These facts support the Court’s conclusion that the debtor has made great strides since the 2017 inspection and that there will, in fact, be no need for further adverse publicity prior to trial.”