Thompson Medical Company, Inc. v. Federal Trade Commission
253 U.S. App. D.C. 18, 791 F.2d 189, 1986 U.S. App. LEXIS 25182 (1986)
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Rule of Law:
The Federal Trade Commission (FTC) has the authority to require an advertiser to possess competent and reliable scientific evidence, including at least two adequate and well-controlled clinical studies, as a 'reasonable basis' before making efficacy claims for an over-the-counter drug, especially when public health is at issue.
Facts:
- Thompson Medical Company marketed and sold an over-the-counter topical analgesic cream named Aspercreme.
- Aspercreme's active ingredient is trolamine salicylate; it does not contain any aspirin (acetyl salicylic acid).
- Thompson ran television advertisements that strongly suggested Aspercreme contained or was related to aspirin.
- One advertisement featured an announcer holding aspirin tablets which were then replaced by a tube of Aspercreme.
- The ad's voiceover stated, 'imagine putting the strong relief of aspirin right where you hurt... Aspercreme starts concentrating all the temporary relief of two aspirin directly at the point of minor arthritis pain.'
- Thompson's advertising also made claims that Aspercreme was effective for the relief of arthritic pain.
Procedural Posture:
- The Federal Trade Commission (FTC) issued an administrative complaint against Thompson Medical Company.
- The case was heard by an Administrative Law Judge (ALJ) within the FTC.
- The ALJ issued an initial decision finding Thompson Medical liable for deceptive advertising.
- Thompson Medical appealed the ALJ's decision to the full Federal Trade Commission.
- The Commission affirmed the ALJ's decision and entered a final order against Thompson Medical.
- Thompson Medical Company, as petitioner, sought review of the FTC's final order in the United States Court of Appeals for the District of Columbia Circuit.
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Issue:
Does the Federal Trade Commission have the authority to require an advertiser to possess at least two adequate and well-controlled clinical studies as a 'reasonable basis' before making efficacy claims for an over-the-counter drug?
Opinions:
Majority - Judge Mikva
Yes. The Federal Trade Commission's order is a valid exercise of its authority to prevent deceptive advertising. The FTC has the discretion to determine what constitutes a 'reasonable basis' for an advertising claim, and for health-related products, it is justified in requiring a high level of scientific substantiation, such as two well-controlled clinical studies, before efficacy claims can be made. The court reasoned that the FTC has substantial expertise in evaluating such claims and that its authority is not preempted by the Food and Drug Administration's (FDA) separate regulatory review. The court found that the FTC appropriately applied its multi-factor framework, first articulated in In re Pfizer, to determine that the specific facts of this case warranted a clinical testing requirement for both establishment and non-establishment claims. Furthermore, the court upheld the FTC's finding that the name 'Aspercreme' combined with the advertising was likely to mislead consumers into believing the product contained aspirin, making the required disclaimer an appropriate remedy.
Analysis:
This decision significantly strengthens the FTC's authority to regulate advertising, particularly for health and wellness products. It affirmed the agency's broad discretion in defining what constitutes a 'reasonable basis' for a claim, establishing that the FTC can demand rigorous scientific evidence, like multiple clinical trials, even for simple efficacy claims that do not explicitly reference scientific proof. This blurs the line between 'establishment' and 'non-establishment' claims, empowering the FTC to set high substantiation standards based on the context and potential consumer harm. The case serves as a major precedent for future FTC actions against companies making unsubstantiated health claims, reinforcing the principle that advertisers bear the burden of proof before making a claim, not after.
