9th Circuit Upholds Alameda County Manufacturer-Funded Drug Disposal Ordinance

On September 30, 2014, the U.S. Court of Appeals for the 9th Circuit unanimously upheld a lower court’s finding that a California county ordinance requiring prescription drug manufacturers to operate and finance certain drug disposal operations was constitutional.  The plaintiffs-appellants in Pharm. Research & Mfrs. of Am v. County of Alameda (9th Cir., No. 3:12-cv-06203-RS) were comprised of the major pharmaceutical and biologic industry trade organizations in the United States.  Specifically, the Pharmaceutical Research & Manufactures of America (“PhRMA”), the Generic Pharmaceutical Association (“GPhA”) and the Biotechnology Industry Organization (“BIO”) alleged that Alameda County, California’s “Safe Drug Disposal” ordinance unconstitutionally violated the Commerce Clause by requiring interstate drug manufacturers to conduct and pay for Alameda County’s drug disposal program.  The 9th Circuit Court of Appeals disagreed, concluding:

“Opinions vary widely as to whether adoption of the Ordinance was a good idea. We leave that debate to other institutions and the public at large. We needed only to review the Ordinance and determine whether it violates the dormant Commerce Clause of the United States Constitution. We did; it does not.”

Under the Alameda County ordinance, enacted in 2012, prescription drug manufacturers, who sell, offer for sale, or distribute “Covered Drugs” in Alameda, are required to operate and finance a “Product Stewardship Program” to provide for the collection, transportation, and disposal of any unwanted “Covered Drug”, regardless of which manufacturer made the drug.  A “Covered Drug” includes “all drugs in 21 U.S.C. § 321(g)(1) of the Federal Food, Drug and Cosmetic Act . . . including both brand name and Generic Drugs.” More information regarding the Alameda County ordinance, including the ordinance itself, is available here.

Although the Alameda County ordinance is a “first-in-the-nation” ordinance, at least one other similar measure has been subsequently enacted at the local level.  King County, Washington’s “Secure Medicine Return Rule & Regulation” was adopted by the King County Board of Health in June 2013, and is also the subject of continuing legal challenge.  See Pharm. Research & Mfrs. of Am. v. King County (W.D. Wash., No. 2:13-cv-02151).  The direct implications of the Alameda County litigation are not immediately clear; however King County is also in the 9th Circuit.  Additional information on the King County Regulation is available here.

It is not yet clear whether PhRMA, GPhA, and BIO will appeal the case to the U.S. Supreme Court.  In the interim, pharmaceutical manufacturers are encouraged to closely review the 9th Circuit opinion, the Alameda County ordinance and regulations, as well as the King County regulations, and evaluate whether and to what extent they may be required to comply with such provisions.

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