May 14 2020

The Centers for Disease and Control and Prevention (CDC) is now recommending that the general public wear face masks to help slow the spread of COVID-19. Along with this recommendation, many businesses, individuals, and other entities have stepped up to assist in manufacturing and distributing the additional masks needed to keep up with the increasing demand. Companies participating in this sector, particularly those shifting manufacturing to produce masks or those manufacturing or distributing masks for the first time, should make sure to understand the current legal landscape before rushing to market. Proactive steps taken premarket can ensure legal compliance and avoid unnecessary liability in the future. 

Face Masks Are Medical Devices Regulated by FDA

Face masks worn for medical purposes are considered medical devices, which means they are regulated by the United States Food and Drug Administration (FDA). Face masks, such as the type recommended by the CDC for the general public to help slow the spread of COVID-19 are medical devices. Normally, non-surgical face masks worn by the general public in this type of scenario would be considered a Class I medical device, which comes with certain regulatory requirements. 

Face Mask EUA Allows Avoidance of Usual Regulatory Process

On April 18, 2020, FDA issued an Emergency Use Authorization (EUA), which authorized the use of face masks for use by the general public in connection with the COVID-19 pandemic. 

Why is this important? Now, anyone making face masks for use by the general public is permitted to market their face masks without going through the usual regulatory process as long as they meet the requirements of the EUA. This allows the face masks to get to the public quicker. However, the EUA requirements must be strictly adhered to in order for the masks to be legally marketed without going through the normal FDA regulatory channels. Failure to do so could result in your product being illegally marketed or misbranded, which can result in recall of the products, forfeiture, seizure of products and profits, criminal penalties and/or hefty civil fines.

Face Mask EUA Provides Product Liability Immunity

Another reason the EUA is important is that it provides product liability protection to Covered Persons under the Department of Health and Human Services PREP Act Declaration related to certain Covered Countermeasures. The definition of Covered Persons under the Declaration is broad and includes manufacturers, distributors, program planners, and other qualified persons as defined in the PREP Act, 42 U.S.C. § 247d-6d. The EUA makes it clear that face masks now meet the definition of a Covered Countermeasure under the Declaration. 

In order to immunize from product liability, the requirements set forth in the EUA must be met. Failure to comply with the EUA could result in a loss of product liability immunity protection. While it may not seem like product liability risk related to face masks for the general public could be very high, savvy plaintiffs’ attorneys can easily find ways to find fault in seemingly innocuous products especially where death may be involved. Liability exposure could easily exceed seven figures for one claim depending on the facts, so it is critical to follow the EUA requirements.

Face Mask EUA Requirements 

  1. Intended Use: Members of the general public, including healthcare providers in healthcare settings as personal protective equipment, to cover their noses and mouths, in accordance with CDC recommendations, to prevent the spread of SARS-CoV-2 during the COVID-19 pandemic.
  1. Labeling:
    1. Must say:
      1. Labeled accurately as a “face mask”
      2. Include a list of the body contacting materials
      3. Recommended use is only by the general public
      4. Recommend cleaning and/or disinfection materials and processes, if applicable
    2. Optional: May provide additional information related to the emergency use of the product that is consistent with, and does not exceed the EUA
    3. Cannot say:
      1. intended for use as a surgical mask, for use in a surgical setting
      2. provides liquid barrier protection or where significant exposure to liquid, bodily or other hazardous fluids, may be expected
      3. intended for use in a clinical setting where the infection risk level through inhalation exposure is high
      4. intended for use in the presence of high intensity heat source or flammable gas
      5. intended for antimicrobial or antiviral protection or related uses or is for use as infection prevention or reduction
      6.  intended for particulate filtration.
  1. Face Mask Materials: Cannot contain any drugs or biologics
  1. Must provide to end user (or end user facility):
    1. Labeling, in hard copy or alternative format (electronic or on a website)
    2. Instructions for recommended cleaning and/or disinfection materials and processes, if applicable
  1. Record Keeping:
    1. Process in place for reporting adverse events to FDA
    2. Any records associated with this EUA are maintained until otherwise notified by FDA and must be made available to FDA for inspection upon request
    3. Must have a process of inventory control and maintain records of the entities to which the face masks are distributed and the numbers of each product distributed
  1. Advertising/Promotion:
    1. All printed matter relating to the use of the face mask must be consistent with the labeling elements
    2. No printed matter may represent or suggest that such product is safe or effective for the prevention or treatment of patients during COVID-19 pandemic
    3. All printed matter must clearly and conspicuously state:
      1. The product has not been FDA cleared or approved
      2. The product has been authorized by FDA under an EUA for use by HCP as PPE to help prevent the spread of infection or illness in healthcare settings and by the general public to help slow the spread of the virus during the COVID-19 pandemic
      3. This product is authorized only for the duration of the declaration that circumstances exist justifying the authorization of the emergency use of medical devices, including alternative products used as medical devices during the COVID-19 outbreak, under section 564(b)(1) of the Act, 21 U.S.C. § 260bbb-3(b)(1) unless the authorization is terminated or revoked sooner.

Price Gouging

Another liability consideration for new actors in the face mask space during the COVID-19 pandemic is to make sure that they are familiar with their state price gouging statutes and are acting in compliance. Face masks are most likely going to be considered “necessary” goods in most jurisdictions in this emergency; therefore, regardless of supply and demand factors, companies need to be sensitive to pricing these products. Although there is no jurisprudence to reference here because something on this scale has not occurred in recent years, pre-emergency pricing can be a good reference point for companies entering the space. Some pricing allowances will likely be made for increased manufacturing costs. For example, if a business has retooled machinery in order to convert to manufacturing a new product. However, face mask pricing needs to be closely examined before going to market in order to avoid subsequent government scrutiny.

A price gouging enforcement action by an Attorney General is an event to be avoided where possible, but even an investigation can be cripplingly expensive. The best way to avoid an investigation is to establish a robust customer complaint resolution program and implement it at the outset of an emergency declaration. We have seen multi-year investigations launched on as few as 20 complaints across an entire state with no opportunity to investigate or respond to the complaints prior to the institution and public announcement of the investigation. Rarely, if ever, is there a similar announcement where an investigation closes with no charges or fines. Price gouging investigations are to be avoided on the front end, premarket, but certainly if a complaint is received, take it seriously and drop the price accordingly.

For additional information on the practical application and effect of the Emergency Use Authorization or other liability questions, please contact Sara Tucker or Chris Jones. Sara has specific experience counseling Fortune 500 medical device companies related to product liability risk as well as FDA regulatory counseling. She has specific experience guiding companies through the shifting medical device regulatory landscape during the COVID-19 pandemic. Chris leads the firm’s Business Litigation Practice Group and his nationwide practice focusing on complex civil and regulatory litigation, includes specific experience with major complex governmental investigations.