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WESTERN STATES MEDICAL CENTER v. SHALALA
238 F.3d 1090 (2001)
Western States Medical Center, a Nevada corporation; Women's International Pharmacy, a Wisconsin corporation; Health Pharmacy, a Wisconsin corporation; Apothecure, a Texas corporation; College Pharmacy, a Colorado corporation; Lakeside Pharmacy, a Tennessee corporation; Wedgewood Village Pharmacy, a New Jersey corporation, Plaintiffs-Appellees,
v.
Donna E. Shalala, in her official capacity as Secretary, United States Department of Health and Human Services; Jane E. Henney, M.D., in her official capacity as Commissioner, Defendants-Appellants.
No. 99-17424
United States Court of Appeals, Ninth Circuit.
Argued and Submitted December 12, 2000
Filed February 6, 2001
Peter J. Smith, Civil Division, Department of Justice, Washington, D.C., for the defendants-appellants.
Michael A. Reiter, Duane, Morris & Heckscher, LLP, Chicago, Illinois, for the plaintiffs-appellees.
Michael S. Labson, Covington & Burling, Washington, D.C., for the amicus.
Before: Mary M. Schroeder, Chief Judge, Cynthia Holcomb Hall, and William A. Fletcher, Circuit Judges.
Argued and Submitted December 12, 2000 — San Francisco, California CYNTHIA HOLCOMB HALL, Circuit Judge: This appeal requires us to assess the constitutionality of two subsections of the Food and Drug Administration Modernization Act of 1997 ("FDAMA"), 21 U.S.C. § 353a. Subsections §§ 353a(a) and (c) of FDAMA prohibit drug providers from promoting or advertising particular compounded drugs. In return, the providers are exempted from the standard drug approval requirements imposed by the Food and Drug Administration. Plaintiffs seek to enjoin the enforcement of these subsections, contending that they violate the First Amendment's guarantee of free speech. The district court agreed with Plaintiffs and granted their motion for summary judgment in a published opinion. See Western States Medical Ctr. v. Shalala,69 F.Supp.2d 1288 (D.Nev.1999). The district court exercised jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1361. We have jurisdiction over this appeal pursuant to 28 U.S.C. § 1291. IPlaintiffs are a group of licensed pharmacies. They have prepared written promotional materials that they distribute by mail and at medical conferences to inform patients and physicians of the uses and effectiveness of specific compounded drugs. "Compounding" is a process in which a pharmacist mixes ingredients to create a medication for an individual patient. Compounding is typically used to prepare medications that are not commercially available, such as a medication for a patient who is allergic to an ingredient in a mass-produced product. Pharmacists can provide compounded drugs to individual patients only upon receipt of a valid prescription. See 21 U.S.C. § 353a(a). The Federal Food, Drug, and Cosmetic Act ("FDCA"), 21 U.S.C. §§ 301-397, regulates drug manufacturing, marketing, and distribution. It invests the Food and Drug Administration ("FDA") with enforcement powers to make sure that the regulations are followed. In 1997, Congress amended the FDCA to exempt compounding from certain requirements of the FDCA, but only if the compounding pharmacies followed several conditions, including refraining from promoting particular compounded drugs. The new legislation sets out several restrictions on compounding including prohibitions on advertisements, like those of the Plaintiffs, that promote particular compounded drugs. See 21 U.S.C. §§ 353a(a) and (c).1 Pharmacists
may, however, inform the public that they offer general compounding services. See 21 U.S.C. § 353a(c). Plaintiffs challenged FDAMA's advertising and solicitation restrictions in district court. They contended that the restrictions violate the Free Speech Clause of the First Amendment. In a well-reasoned opinion, the district court granted Plaintiff's motion for summary judgment, holding that the restrictions do not meet the test for acceptable government regulation of commercial speech set forth in Central Hudson Gas & Electric Corp. v. Public Service Commission,447 U.S. 557, 566, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980). The district court also held that the unconstitutional provisions were severable from the rest of FDAMA. This Court reviews the district court's grant of summary judgment de novo. See Gutowsky v. County of Placer,108 F.3d 256, 259 (9th Cir.1997). "The evidence must be viewed in the light most favorable to the nonmoving party to determine whether there are any genuine issues of material fact for trial, and whether the district court correctly applied the relevant substantive law." Federal Deposit Ins. Corp. v. O'Melveny & Meyers,969 F.2d 744, 747 (9th Cir.1992).
1. The statutes provide:
[Some FDCA requirements do not] apply to a drug product if the drug product is compounded for an identified individual patient based on the unsolicited receipt of a valid prescription order or a notation, approved by the prescribing practitioner, on the prescription order that a compounded product is necessary for the identified patient. . . . 21 U.S.C. § 353a(a). A drug may be compounded under subsection (a) of this section only if the pharmacy, licensed pharmacist, or licensed physician does not advertise or promote the compounding of any particular drug, class of drug, or type of drug. The pharmacy, licensed pharmacist, or licensed physician may advertise and promote the compounding service provided by the licensed pharmacist or licensed physician. 21 U.S.C. § 353a(c). 2. The clause reads:
If any provision of this Act is declared unconstitutional, or the applicability thereof to any person or circumstance is held invalid, the constitutionality of the remainder of the Act and the applicability thereof to other persons and circumstances shall not be affected thereby. 21 U.S.C. § 391.
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