Wednesday, October 1, 2014
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Panel Upholds Alameda County’s Drug Disposal Ordinance
By a MetNews Staff Writer
An Alameda County ordinance requiring prescription drug manufacturers to pick up and dispose of unused and unwanted drugs sold in the county, regardless of where or by whom the drugs were manufactured, does not violate the Commerce Clause, the Ninth U.S. Circuit Court of Appeals ruled yesterday.
Rejecting arguments by the Pharmaceutical Research and Manufacturers of America, Generic Pharmaceutical Association and Biotechnology Industry Organization, the panel held that the program—the cost of which is estimated by the county at $330,000 a year and by drug companies at $1.2 million, compared with $965 million annually in pharmaceutical sales in the county—does not discriminate against, or place an undue burden on, interstate commerce.
The 2012 Safe Drug Disposal Ordinance requires the companies to set up disposal kiosks throughout the county and to promote the program to county residents. The drug companies must also empty the kiosks and destroy the drugs at medical-waste facilities.
U.S. District Judge Richard Seeborg of the Northern District of California granted the county summary judgment, which was affirmed yesterday by the Ninth Circuit.
Because the ordinance applies equally to all drug manufacturers that sell within Alameda County, there was no discrimination against out-of-state drugmakers, and the law is not an unlawful tariff, the court found.
“An ordinance that applies across-the-board provides no geographic advantages,” Judge N. Randy Smith wrote for the court. “This holds true even where the ordinance only affects interstate commerce due to an absence of intrastate businesses. Given that the ordinance applies across the board, it does not discriminate at all, let alone in the same way as a tariff.”
The trade groups also failed to show that the ordinance would affect transactions beyond the borders of Alameda County.
In fact, the plain language of the ordinance exempts drug companies that do not conduct business in Alameda County from the program, the judge noted, adding that those that do are also not required to implement similar programs outside of the county unless they face such orders from another jurisdiction.
“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,” Smith wrote.
Smith cited Association des Eleveurs de Canards et D’oies du Quebec v. Harris, 729 F.3d 937 (9th Cir. 2013), which upheld California’s law banning foie gras—the cooked fatty liver of a force-fed goose or duck. In rejecting a Commerce Clause challenge, the appellate panel noted that the law applied equally to animals raised in and out of the state.
As for the cost burden of the Alameda enactment, Smith said, given the substantial pharmaceutical revenue stream in the county, even $1.2 million to collectively administer the program cannot be considered a substantial burden under the Commerce Clause.
As to the merits of the “first-in-the-nation” law, Smith said:
“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.”
Smith was joined by Judge Morgan Christen and Senior District Judge Lawrence L. Piersol of South Dakota, sitting by designation.
The case is Pharmaceutical Research and Manufacturers of America v. County of Alameda, 13-16833.
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