Logic Tech. Dev. LLC v. U.S. Food & Drug Admin.

84 F.4th 537

LOGIC TECHNOLOGY DEVELOPMENT LLC, Petitioner v. UNITED STATES FOOD AND DRUG ADMINISTRATION

No. 22-3030

United States Court of Appeals, Third Circuit

Argued May 9, 2023

Filed: October 19, 2023

On Petition from the United States Food & Drug Administration, (FDA-1: PM0000528.PD1, PM0000534.PD1, PM0000539.PD1)

Bryan M. Haynes, Troutman Pepper, 1001 Haxall Point, 15th Floor, Richmond, VA 23219, Misha Tseytlin [ARGUED], Troutman Pepper, 227 W Monroe Street, Suite 3900, Chicago, IL 60606, Counsel for Petitioner

Alisa B. Klein, Catherine M. Padhi [ARGUED], Lindsey Powell, United States Department of Justice, 950 Pennsylvania Avenue NW, Washington, D.C. 20530, Counsel for Respondent

William B. Schultz, Zuckerman Spaeder, 1800 M Street NW Suite 1000, Washington, DC 20036, Counsel for Amici-Respondents

Before: KRAUSE, PORTER, and AMBRO, Circuit Judges

OPINION

KRAUSE, Circuit Judge.

New information and changes in the marketplace can alter consumers' decisions about the products they buy, and the same is true of the federal agencies that regulate the marketing of those products. Here, starting in early 2020, the Food and Drug Administration (FDA) began taking aggressive action to remove fruit- and dessert-flavored e-cigarettes, also known as electronic nicotine delivery systems (ENDS), from the stream of commerce, leaving aside at that time tobacco- and menthol-flavored ENDS. More recently, based on additional studies and market data, the FDA has denied the applications of importers and manufacturers like Petitioner Logic Technology Development (Logic) to market menthol-flavored ENDS.

Logic now challenges that denial as a violation of the Administrative Procedure Act (APA), claiming it was arbitrary and capricious for the FDA (1) to apply the same regulatory framework to menthol that it used to assess the appropriateness of sweeter flavors, (2) to ultimately reject its applications for its menthol-flavored ENDS to remain on the market, and (3) to do so without granting Logic a transition period following that decision. For the reasons explained below, however, we find those arguments unpersuasive because the FDA applied a regulatory framework consistent with its statutory mandate, provided a reasoned explanation for its denial, and based its decision on scientific judgments that we may not second-guess. We will therefore deny Logic's petition for review.

I. Background

Because our resolution of Logic's petition requires an understanding of the highly reticulated scheme that Congress laid out in the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act), we review that framework before assessing its application to the menthol-flavored products at issue here.

A. Statutory framework

The Tobacco Control Act requires any tobacco product not on the market before February 15, 2007 to receive approval from the FDA. See 21 U.S.C. § 387j(a)(1)-(2). Only if the FDA concludes that "permitting such tobacco product to be marketed would be appropriate for the protection of the public health" (health-appropriate) can the product be approved.¹ Id. § 387j(c)(2). Manufacturers seeking advance permission to market one of these newer products can submit a "premarket tobacco product application" (PMTA or premarket application) to the agency. See Liquid Labs LLC v. FDA, 52 F.4th 533, 537 (3d Cir. 2022) (citations omitted).

When considering such an application, the FDA is statutorily required to conduct a balancing test to determine whether an ENDS is health-appropriate and, thus, whether it can remain on the market. The agency must assess:

[T]he risks and benefits to the population as a whole, including users and nonusers of the tobacco product, and taking into account—

(A) the increased or decreased likelihood that existing users of tobacco products will stop using such products; and

(B) the increased or decreased likelihood that those who do not use tobacco products will start using such tobacco products.

21 U.S.C. § 387j(c)(4)(A)-(B). This mandate in effect creates a sliding scale: the greater the risk of the new tobacco product to non-smokers, especially children, the greater the benefit to smokers that the manufacturer must demonstrate. See Bidi Vapor LLC v. FDA, 47 F.4th 1191, 1211 (11th Cir. 2022) (Rosenbaum, J., dissenting).

When applying that test, the FDA is to consult a wide range of evidence. The agency must deny a premarket application "if, upon the basis of the information submitted to the Secretary as part of the application and any other information . . . with respect to such tobacco product," it determines that the product is not health-appropriate. 21 U.S.C. § 387j(c)(2)(A) (emphasis added). And it "shall, when appropriate" make that determination "on the basis of well-controlled investigations, which may include 1 or more clinical investigations by experts qualified by training and experience to evaluate the tobacco product." Id. § 387j(c)(5)(A). But if the agency "determines that there exists valid scientific evidence" beyond those studies that "is sufficient to evaluate the tobacco product, the Secretary may authorize that the [health-appropriateness] determination . . . be made on the basis of such evidence. Id. § 387j(c)(5)(B).

B. The FDA's previous regulation of vaping

Within the FDA, the Center for Tobacco Products (the Center) manages the premarket application evaluation process.² The Center, in turn, contains multiple divisions, including the Director's office, the Office of Science, and the Office of Compliance and Enforcement.³ A manufacturer's premarket application passes through several discipline-specific reviews, including engineering, chemistry, epidemiology, and social sciences. The Technical Project Lead then synthesizes those teams' findings and ultimately determines whether the product is health-appropriate. Though the FDA has delegated authority to review premarket applications to the Office of Science, the Director retains supervisory authority over the Center's component offices. Thus, there is room for deliberation among the Center's teams, but the buck stops with the Director.

The Center's experts began to face a new challenge in the late 2010s as youth tobacco product use suddenly skyrocketed. Prior to 2017, high schoolers' e-cigarette use had been dropping. But from 2017 to 2019, "ENDS product use more than doubled among middle school and high school students." JA 1118. From 2017 to 2018, the proportion of twelfth graders who had smoked an e-cigarette in the past thirty days went from 16.6% to 26.7%. For tenth graders, that figure went from 13.1% to 21.7% in the same period. According to the National Youth Tobacco Survey (the Youth Survey), among high schoolers overall, e-cigarette use went from 11.7% to 20.8%. By 2018, the Surgeon General had deemed youth ENDS use an "epidemic." Prohibition Juice Co. v. FDA, 45 F.4th 8, 10 (D.C. Cir. 2022).

Flavored e-cigarettes were the driving force behind this epidemic. Youth Survey data showed that in 2014, 65.1% of high schoolers and 55.1% of middle schoolers who were using ENDS said they were using a non-tobacco flavor (including menthol). By 2022, that figure had risen to 85.5% for high schoolers and 81.5% for middle schoolers, meaning approximately 2,110,000 of the 2,550,000 students using ENDS. Manufacturers were marketing ENDS with names and flavors that were more appropriate for a candy store than a smoke shop, such as "Brain Freeze Caramel Cone, Buncha Crunch . . . Crazy Bubble Grape, Giggle Juice," id. at 15, "Peanut Butter Milk Pie, Bad Monkey Giovanni, and Sunshine Vape Dragon Berry Balls," Gripum LLC v. FDA, 47 F.4th 553, 556 (7th Cir. 2022) (internal quotation marks omitted). The results were predictable. Flavors that most resembled fruit, candies, or desserts were more popular with kids than those that resembled combustible cigarettes. In a 2019 survey of kids who used JUUL e-cigarettes—then the most popular ENDS brand—the vast majority of respondents listed mango, mint, or fruit as the flavor they used most often. Tobacco and menthol barely registered with respondents.

The FDA had to figure out how it would address this crisis within the bounds of the Tobacco Control Act. The agency promulgated multiple guidance documents for manufacturers, the most relevant here being one published in June 2019 (Premarket Application Guidance),⁴ which set out what the FDA was looking for in premarket applications for ENDS, and another, published in April 2020 (Enforcement Priorities),⁵ which articulated the agency's priorities for enforcement actions against manufacturers whose products were not considered health-appropriate.

In the Premarket Application Guidance, the FDA said that "the finding of whether permitting the marketing of a product would be [health-appropriate] will be determined, when appropriate, on the basis of well-controlled investigations." JA 1027. "Nonclinical studies alone," on the other hand, "generally [would] not [be] sufficient to support [such] a determination." Id. The FDA also recommended that manufacturers "compare the health risks of its product to both products within the same category and subcategory" that "are most likely to [be] considered interchangeable." JA 1028. As applied to fruit-flavored ENDS, the Premarket Application Guidance meant that the FDA would not approve a product without evidence that it offered benefits "over an appropriate comparator tobacco-flavored ENDS" with randomized controlled trials, longitudinal cohort studies, or other similar evidence "that could potentially demonstrate the [relative health] benefit[s] of . . . flavored ENDS." Liquid Labs, 52 F.4th at 538 (citation omitted).

The Enforcement Priorities reflected recent trends in youth ENDS vaping. Highest priority would be given to non-tobacco, non-menthol flavors, along with other ENDS manufacturers with insufficient marketing restrictions or products marketed to kids. To support this approach, the agency cited survey data like that...