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After months of squabbling, the Food and Drug Administration has agreed to the key demands in a closely watched lawsuit filed by Pacira Pharmaceuticals, which accused the agency of overstepping its authority and trampling its right to market a key product.

Most significantly, the FDA rescinded a September 2014 warning letter that accused Pacira of allegedly promoting the drug for unapproved uses and overstating its effectiveness. The agency had actually removed the letter from its web site several weeks ago as negotiations were under way, a move that FDA watchers said at the time was highly unusual.

The company can also now promote its Exparel painkiller for use after a variety of surgeries, rather than only after bunions and hemorrhoids are removed. Pacira can also tell surgeons and anesthesiologists that Exparel can relieve pain for up to 72 hours, much longer than the 24-hour limit the FDA contended had originally been authorized when the drug was approved in 2011.


Read more: FDA yanks Pacira letter

“We’re not giving up anything and we won everything we were after,” Dave Stack, the Pacira chief executive told us. “Once the FDA understood that an unfortunate mistake had been made, we were able to work with them to reverse the action.”

The outcome surprised one FDA watcher, who had been uncertain whether the company would be able to persuade the agency it was wrong. “I’m astounded,” said Arnie Friede, a former FDA associate chief counsel and a former senior corporate counsel at Pfizer.


In a brief statement, the agency acknowledged “the revised labeling is based on scientific evidence that was previously submitted as part” of the original marketing application that the company submitted to the FDA prior to regulatory approval. This is a distinct about-face from the allegations in the warning letter, which said the “violations were extremely concerning from a public health perspective.”

Drug makers must prove their medicines work to treat a specific disease before marketing them for that purpose. As a result, the FDA has the right to prevent them from promoting drugs for unapproved uses. But the pharmaceutical industry has increasingly complained that the FDA regularly oversteps its bounds and the Pacira lawsuit was the latest to test that notion by arguing the warning letter was incorrect.

Exparel, however, has been a controversial product among orthopedic surgeons. The medicine is administered to patients using a proprietary delivery technology but costs $285 a vial compared with about $3 for an older version of the same treatment. Some surgeons say Exparel is not worth the cost, but Stack argued the drug reduces reliance on opioids and costly hospital stays.

Notably, Pacira also had claimed the FDA was unfairly squelching its free speech rights. The issue has been widely debated after a federal appeals court in 2012 overturned a criminal conviction of a sales rep for promoting off-label uses. The court ruled his speech was protected, since the information conveyed to doctors was truthful and not misleading.

Yet Stack told us the company and its lawyers did not have to push the free speech argument because the FDA was willing to revise the labeling, which allows for more widespread marketing.

What is not yet clear is whether the US Department of Justice is still examining Exparel marketing. The agency issued a subpoena to Pacira last April in search of documents. A Justice Department spokesman declined to comment and Stack would only say that the company has complied with the subpoena and provided information as requested.