Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 1 of 6 PageID# 10704
`Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 1 of 6 Page|D# 10704
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`EXHIBIT 5
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`EXHIBIT 5
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`Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 2 of 6 PageID# 10705
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`UNITED STATES INTERNATIONAL TRADE COMMISSION
`WASHINGTON, D.C.
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`Before the Honorable Clark S. Cheney
`Administrative Law Judge
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`In the Matter of
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`CERTAIN TOBACCO HEATING
`ARTICLES AND COMPONENTS
`THEREOF
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`Investigation No. 337-TA-1199
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`RESPONDENTS’ POST-HEARING INITIAL BRIEF
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`PUBLIC VERSION
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`Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 3 of 6 PageID# 10706
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`(Ehrlich) 1464:3-6. For SE products, the FDA only requires them to be no more harmful than a
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`predicate product—i.e., a grandfathered product—implicating minimal FDA harm assessment, far
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`less data, and does not “deal with that public health standard that’s at the end of the PMTA.” Tr.
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`(Figlar) 149:16-150:3; Tr. (Murrelle) 514:14-16; Tr. (Clissold) 529:17-24; Tr. (Ehrlich) 1463:25-
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`1464:25. Indeed, the most harmful tobacco product in existence could be sold legally, so long as
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`it is grandfathered, and another product could obtain SE authorization as long as it were no more
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`harmful than that most harmful tobacco product, resulting in no substantive FDA harm assessment
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`for either. Tr. (Ehrlich) 1438:21-1439:7. This is how Eclipse, Complainants’ commercially failed
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`HNB product, remains on the U.S. market. Tr. (Figlar) 66:6-12, 138:20-22, 149:8-15; Tr.
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`(Murrelle) 468:14-17; Tr. (Ehrlich) 1438:6-20. The original Eclipse was grandfathered, and
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`subsequent versions were bootstrapped to that grandfathered product. Tr. (Figlar) 66:6-12138:20-
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`22, 149:8-150:3; Tr. (Ehrlich) 1438:6-20. Other grandfathered or SE products include smokeless
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`tobacco and also lack any FDA harm assessment. Tr. (Murrelle) 467:23-468:7.
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`3.
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`Lack Of FDA Authorization Renders E-Cigarettes Illegal
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`All e-cigarettes are illegal and thus cannot be IQOS substitutes. Tr. (Ehrlich) 1414:10-21,
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`1477:11-13, 1478:3-14. As discussed, e-cigarettes must obtain PMTA authorization to be legally
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`sold in the U.S., but, to date, none have achieved this. RX-0324.5; Tr. (Figlar) 68:24-69:5; Tr.
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`(Ehrlich) 1465:3-16. Thus, no e-cigarette on the U.S. market today is legal. Id. FDA crafted a
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`compliance policy for discretionary enforcement so that e-cigarettes on sale as of the date of the
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`Deeming Rule, all of which were automatically illegal without a PMTA, could remain on the
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`market until a specified deadline for premarket submissions. Tr. (Ehrlich) 1475:8-24.
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`“Significantly, this policy did not confer lawful marketing status on new tobacco products being
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`marketed without the necessary premarket authorization.” RX-0324.5 (emphasis added); see Tr.
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`Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 4 of 6 PageID# 10707
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`(Ehrlich) 1416:15-24.
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`Under its compliance policy, FDA delayed enforcement of the e-cigarette PMTA deadline
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`multiple times, leaving these illegal products on the U.S. market without any FDA harm review.
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`See RX-0324.5-.7; Tr. (Ehrlich) 1414:22-1415:17. Several stakeholders, including the American
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`Academy of Pediatrics, the American Cancer Society Cancer Action Network, the American Heart
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`Association, the American Lung Association, the Campaign for Tobacco-Free Kids, the Truth
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`Initiative, and individual physicians, were concerned about the unaddressed surge of youth use of
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`e-cigarettes and considered the FDA’s delay an APA violation, so they sued to force the agency to
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`fulfill its legal obligations. Id.; RX-0324.6; Am. Academy of Pediatrics v. FDA, 399 F. Supp. 3d
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`479 (D. Md. 2019). The judge held in the plaintiffs’ favor, finding “a purposeful avoidance by the
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`industry of complying with the premarket requirements,” and vacated FDA’s compliance policy.
`Id. at 485, 487; Tr. (Ehrlich) 1415:18-22.
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`Given the uncertainty surrounding the efficacy of e-cigarettes and the public health
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`emergency caused by the epidemic level of youth use, the court ordered that all e-cigarette PMTAs
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`must be submitted to FDA by September 9, 2020, to avoid further delay of statutorily mandated
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`FDA harm review. RX-0324.6-.7; Tr. (Clissold) 530:19-21; Tr. (Ehrlich) 1415:23-1416:14;
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`Pediatrics, 399 F. Supp. 3d at 486. The court allowed a product subject to a timely PMTA to
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`remain on the market “for a period not to exceed one year from the date of application.”
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`Pediatrics, 399 F. Supp. 3d at 487; see Tr. (Clissold) 571:3-12; Tr. (Ehrlich) 1416:5-14, 1469:18-
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`1470:8.
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`Consequently, not only do they remain illegal, e-cigarettes with no PMTA and those with
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`a PMTA submitted more than a year ago (thus outside of the court’s grace period) are no longer
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`exempt from FDA enforcement. See, e.g., RX-0324.4, .5, .11, .12; Tr. (Clissold) 571:19:572-7;
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`Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 5 of 6 PageID# 10708
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`Tr. (Ehrlich) 1419:15-20, 1470:4-9. Notably, the grace period for Complainants’ Vuse Solo
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`already expired in October 2020, and, absent highly unlikely action by FDA, the grace period for
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`the other Vuse e-cigarettes will expire this year in April (Vibe and Ciro) and September (Alto)—
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`all prior to the Final Determination in this Investigation. See JX-0112C (Figlar) at 116:3-14; Tr.
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`(Figlar) 81:13-17, 98:17-23, 100:1-7, 134:4-16; Tr. (Clissold) 537:13-17; Tr. (Ehrlich) 1416:25-
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`1417:17, 1471:11-22.
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`E-cigarette PMTA enforcement delays experienced over the last few years will not
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`continue indefinitely. The district court judge explicitly retained jurisdiction over the case to
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`ensure he could take further action, as needed, and both FDA experts agree that any deviations
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`from the judge’s order can only be made with leave of court. Tr. (Clissold) 571:3-18; Tr. (Ehrlich)
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`1417:6-9, 1422:24-1423:4, 1494:6-13; Pediatrics, 399 F. Supp. 3d at 487. Moreover, FDA has
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`warned that “[m]anufacturers cannot have settled expectations to market unlawful products,
`especially in the face of evolving public health concerns.” RX-0324.28.
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`4.
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`Lack Of FDA Authorization Renders
`The E-Cigarette Market Highly Uncertain
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`Another reason e-cigarettes cannot be IQOS substitutes is that the U.S. market for such
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`products is uncertain and unreliable. Tr. (Ehrlich) 1417:10-23. First, no one knows whether or
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`when any or which e-cigarettes will receive PMTA-authorization. Tr. (Ehrlich) 1448:11-1449:17,
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`1486:13-17. To date, no e-cigarette has received such authorization. See, e.g., JX-0039 at -6450.
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`David Kessler, former FDA Commissioner and Co-Chair of President Biden’s Coronavirus
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`Taskforce, “wouldn’t want to bet on” any e-cigarettes surviving the FDA review due to “the
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`explosion in youth use” of those products and the uncertainty in the industry it has caused. RX-
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`0325.3-.4; Tr. (Ehrlich) 1449:18-1450:10; see Tr. (Clissold) 572:21-573:25, 574:4-575:1.
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`Complainants’ Dr. Figlar and Mr. Clissold both conceded there is no guarantee that any e-cigarette
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`Case 1:20-cv-00393-LO-TCB Document 477-4 Filed 03/11/21 Page 6 of 6 PageID# 10709
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`“be required to file quarterly reports on the first day of each calendar quarter describing the status
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`of FDA approval of its domestic industry product and its continued . . . expenditures” for the
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`domestic industry products for a period of 18 months. Id. The ALJ should further recommend the
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`limited exclusion order be rescinded if Complainants’ domestic industry product has not been
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`approved for use in the U.S. by the expiration of that 18 month reporting period, or if Complainants
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`have ceased making substantial expenditures to exploit the patents during the reporting period. Id.
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`VIII. CONCLUSION
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`Respondents respectfully request that no violation of Section 337 be found and no remedies
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`issued.
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`Dated: February 12, 2021
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`Respectfully submitted,
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`/s/ Bert C. Reiser
`Maximilian A. Grant
`Bert C. Reiser
`Jamie D. Underwood
`LATHAM & WATKINS LLP
`555 Eleventh Street, N.W.
`Suite 1000
`Washington, DC 20004
`Telephone: (202) 637-2200
`Facsimile: (202) 637-2201
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`Brenda L. Danek
`LATHAM & WATKINS LLP
`330 North Wabash Avenue, Suite 2800
`Chicago, IL 60611
`Telephone: (312) 876-7700
`Facsimile: (312) 993-9767
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`Counsel for Respondents
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