A federal appeals court in San Francisco today upheld a pioneering Alameda County law that requires prescription drug makers to pay for programs to dispose of expired and unused drugs.
A three-judge panel of the 9th U.S. Circuit Court of Appeals unanimously ruled that the law is not an unconstitutional obstacle to interstate commerce.
Judge N. Randy Smith wrote that manufacturers challenging the law “provide no evidence that the ordinance will interrupt, or even decrease, the flow of goods into or out of Alameda (County).”
“Without any evidence that the ordinance will affect the interstate flow of goods, we cannot say that the ordinance substantially burdens interstate commerce,” Smith wrote for the court.
The panel upheld a similar ruling in which U.S. District Judge Richard Seeborg last year dismissed the lawsuit filed in 2012 by three pharmaceutical and biotechnology associations.
The take-back law was enacted by the Alameda County Board of Supervisors in 2012 and was the first of its kind in the nation.
It requires manufacturers whose drugs are sold in the county to pay for disposal bins where unused medications can be thrown away and later destroyed in medical waste facilities. The program must also include public education.
The law applies to all manufacturers who sell drugs in the county, whether or not they have a local office or factory. The county has estimated that local annual drug sales total $965 million.
The purpose of the law is to protect children and elderly people from accidental ingestion of unused pills and prevent water contamination from drugs that are flushed away or placed in landfills.
The decision could be appealed further to an 11-judge panel of the appeals court or to the U.S. Supreme Court.
“We are reviewing our legal options and will decide our next steps in consultation with our companies and co-plaintiffs,” said Mit Spears, the general counsel of Pharmaceutical Research and Manufacturers of America, known as PhRMA.
The plaintiffs in the case were PhRMA, the Generic Pharmaceutical Association and the Biotechnology Industry Organization, all based in Washington, D.C.
Spears added in a statement, “Off-loading the costs of a local take-back program onto out-of-state consumers and businesses, as is the situation in Alameda, is not an appropriate way to address any of the problems associated with the misuse of prescription medicines.”
He said PhRMA supports “a variety of consumer education programs aimed at the safe use and disposal of prescription medicines.”
The groups’ lawsuit alleged the law intruded on Congress’s constitutional power to regulate interstate commerce in three ways: by discriminating against out-of-state manufacturers, by controlling interstate commerce and by placing a burden on such commerce.
But the appeals court said the law does not discriminate because “it treats all private companies exactly the same,” whether their places of business are inside or outside the county.
It also said, “There is nothing unusual or unconstitutional per se about a state or county regulating the in-state conduct of an out-of-state entity when the out-of-state entity chooses to engage the state or county through interstate commerce.”
The county contended the program had a minimal effect on interstate commerce when balanced against its benefits to public health, safety and the environment.
The county estimated the startup costs of the program are $1.1 million and annual operating costs are $530,000. The manufacturers estimate the annual costs are $1.2 million.
Julia Cheever, Bay City News
