Drugmakers, retailers must face 'maximum strength' claim in decongestant false ad litigation in US

• The 2nd Circuit revived claims specifically for 'maximum strength' labeled products because defendants voluntarily added that phrase, and for brand-name drugs approved through the New Drug Application process where manufacturers could have updated labels
• Most state law-based consumer claims were dismissed as preempted by federal law since defendants followed FDA labeling requirements, with the court stating 'the fix must flow not from the FDA' rather than litigation
• Consumer attorney stated manufacturers 'made billions of dollars selling products with a decongestant that they long knew was entirely ineffective,' calling the case 'far from over' despite the mixed ruling

Summary: False Advertising Litigation Over Ineffective Decongestants Partially Revived

A federal appeals court on Thursday partially revived nationwide litigation against major drugmakers and retailers over the sale of billions of dollars in over-the-counter decongestants containing ineffective ingredients. The 2nd U.S. Circuit Court of Appeals ruled that certain claims can proceed against companies including Procter & Gamble, CVS, Haleon, Bayer, GSK, Kenvue, Costco, Target, Walgreens, and Walmart.

Key Background:

Approximately 100 lawsuits were filed after a September 2023 FDA advisory panel determined that oral phenylephrine—found in products like Vicks NyQuil Severe Cold & Flu and Advil Sinus Congestion & Pain—was no better than a placebo. Studies have questioned the ingredient's efficacy for 20 years. In November 2024, the FDA proposed removing oral phenylephrine from over-the-counter cold medications.

Court Ruling:

The appeals court found federal law preempted most state-law claims, as defendants followed FDA labeling requirements. However, two categories of claims were revived:

• Products labeled "maximum strength"—a marketing phrase added by manufacturers independently
• Brand-name drugs approved through the New Drug Application process, where manufacturers could have updated labels with current scientific evidence

The court dismissed civil racketeering claims, ruling consumers lacked standing.

Market Implications:

Consumer lawyers emphasized manufacturers "made billions of dollars selling products with a decongestant that they long knew...was entirely ineffective," warning the litigation is "far from over." The case now returns to Brooklyn federal court after being dismissed in October 2024. This represents significant financial and reputational exposure for major pharmaceutical and retail companies in the OTC decongestant market.