Judging a Pill by its Cover

The expense of public healthcare has given rise to a policy debate regarding whether the public would benefit by increased use of less-expensive generic pharmaceuticals rather than brand-name pharmaceuticals. One proposal to decrease physician and patient preference for brand-name pharmaceuticals would be to eliminate trade dress protection for pill shapes and colors. Historically, drug companies have been accorded exclusive rights to their pharmaceutical "trade dress"—the unique, eye-catching pill colors and shapes that consumers use to identify the brand of the pharmaceutical product. Pharmaceutical trade dress protects both the drug manufacturer and the public by preventing: A) the surreptitious substitution of a similar, but not identical, drug for the one being prescribed; and B) the accidental substitution of one drug for a completely different drug when the two happen to look alike.

B. Brett Heavner

Some recent commentators allege that pharmaceutical trade dress protection deters use of FDA-approved generic drugs due to fears of medication errors, decreased patient adherence, and the loss of the beneficial placebo effect. Specifically, these commentators argue that patients who rely on pill color and shape to identify their medications may stop taking the medication or become confused if their switch to a generic is accompanied by a change in the color or shape. Further, they assert that effectiveness of all drugs can, in part, be ascribed to a beneficial placebo effect. This placebo effect may be reduced if patients have less faith in the generic medication due to use of a different color and shape from the original name-brand drug. Despite the vigor of the criticism aimed at pharmaceutical trade dress, there has been little factual analysis of whether pharmaceutical trade dress is actually an impediment to the use of generic drugs or whether there are potential adverse consequences of scrapping pharmaceutical trade dress in its entirety.

What is Trade Dress?

Trade dress is the overall look and feel of a product, including the physical attributes of the product's design and/or its packaging. Product-design trade dress may include color, size, shape, aroma, and even flavor. To secure trade dress protection, the drug manufacturer must demonstrate that the consumer has come to associate the particular combination of physical attributes (color, size, shape, flavor, etc.) with the drug manufacturer. Marketing and advertising typically play a central and critical role in this process. Further, the physical attributes of the drug must not be "functional." That is, they must not be essential to the use or purpose of the drug, and must not affect the cost or quality or performance of the drug. If the product design is found to be legally functional, protection is not available. Over the past 30 years or so, the U.S. courts have been judicious in granting trade dress protection when the combinations of a pill's physical attributes are shown to identify the source of the product, and also in denying such protection when those same physical attributes serve another purpose, such as making the pills more palatable and digestible, or making it easier for consumers to determine the pills' strength.

Elimination: Good or Even Necessary?

Proponents of the recent attacks on pharmaceutical trade dress have failed to address a number of theoretical and practical issues that would arise should trade dress protection be eliminated in the pharmaceutical field.

First, the debate so far has focused solely on FDA-approved generic drugs that are bioequivalent to the brand-name drug. However, pharmaceutical trade dress serves a very important function in preventing infringers from marketing non-generic and non-bioequivalent "look-alike" drugs with significantly different active ingredients and/or effectiveness. It is unclear how a world without pharmaceutical trade dress would effectively combat such look-alike problems absent significantly increased FDA supervision.

Second, there has been no discussion of accidental medication errors when two completely different pharmaceutical products by happenstance share similar but uncommon physical attributes. While patients may double-check medications that consist of commonly used physical attributes (such as plain white tablets or clear capsules), they may be less likely to do so when the pharmaceuticals have an unusual shape or color combination. So pharmaceutical trade dress protection may reduce the risk of a medication error by assuring that unusual combinations of physical attributes are not displayed on multiple drugs. Preventing accidental medication errors from look-alikes may be particularly important to over-the-counter drug or vitamin manufacturers who may not have the benefit of strict FDA regulatory review.

Third, pharmaceutical trade dress may not be as significant an impediment to the use of generics as the commentators presume. To the extent that pill color and size are used by consumers to identify dosage strength or other non-source identifying information about a medication, those color and size features are functional and therefore already non-protectable under current U.S. trade dress law. Indeed, the name-brand drug manufacturers have a fairly steep hurdle to establish trade dress protection in their pills' shape and color. As noted above, as a prerequisite for trade dress protection, the manufacturers must show that patients use the color and shape to identify the source of the pharmaceutical. Typically, this is only successful with unique and eye-catching color combinations or unusual pill shapes that have been highlighted for consumers in the branded drugs' advertising.

Fourth, there is a question as to whether the benefits of the placebo effect are sufficiently great to outweigh the benefits of trade dress protection for pharmaceuticals. The beneficial placebo effect is likely to be most pronounced in the treatment of conditions with a psychosomatic component (such as anxiety, depression, impotence, etc.). This fairly small portion of the pharmacopoeia may be insufficient to justify the total elimination of pharmaceutical trade dress protection. Further, the placebo effect may not be attributable to pill shape and color at all, but may instead derive from the perceived quality of the medical care and/or the high cost of the name-brand prescription. If the patient is aware of the generic switch, and believes that the generic is a lower-quality product, a continuation of color and shape may not preserve the beneficial placebo effect.

Fifth, the legitimacy of adopting a public policy to foster a "beneficial" placebo effect may be philosophically suspect. The placebo effect occurs when patients' conditions improve merely because they believe that they are taking a helpful drug (whether it actually is helpful or not). However, the same "positive effect" could be felt by any consumer of counterfeit goods in other fields. The fashion-conscious consumer could look and feel better when they believe they are wearing a Rolex watch or sporting a Gucci handbag, even if the watch and handbag are fakes. Clearly, these sorts of psychological benefits to the consumers of counterfeit goods do not justify the illegal actions of counterfeiters outside the pharmaceutical field. Should our health policy aim to preserve a similarly psychological placebo effect by purposefully clouding the source of a pharmaceutical product in the mind of the patient?

Tips for Drug Manufacturers

Given the rise of patient-directed advertising, combined with the rise of FDA-approved generics, the issue of pharmaceutical trade dress is likely to become an increasingly important and contentious issue for the near future. Indeed, there is a general expectation that generics companies will seize on this debate in an attempt to defeat trade dress protection for brand-name pharmaceutical products whose U.S. patents are set to expire soon.

With respect to the public policy debate, it is imperative that brand-name drug manufacturers: A) educate the public about the importance of trade dress to the industry; and B) publicly question the assumptions underlying the arguments for the elimination of pharmaceutical trade dress. While the debate about promoting the use of generic drugs is a healthy one, it should not be hijacked by generic manufacturers as a justification for a wholesale attack on pharmaceutical trade dress rights.

As a practical matter, drug name manufacturers desiring trade dress protection for their products must carefully select and cultivate that trade dress. The combination of physical attributes comprising the trade dress must be unique and not commonly found in the field. It must not serve a functional purpose or affect the performance of the drug in any way. Further, once a unique combination of non-functional physical attributes is selected, the drug manufacturer must launch a campaign aimed at linking this trade dress exclusively with the manufacturer in the minds of consumers. While developing a protectable pharmaceutical trade dress may require a great deal of planning and effort, it may be a very effective tool to boost consumer recognition and desire for the product.

B. Brett Heavner is a Partner at Finnegan Henderson, Farabow, Garrett & Dunner. He can be reached at b.brett.heavner@finnegan.com