Issue of the Case

When a Board of Pharmacy uses a Web site or newsletter to communicate its interpretations of state law and cites appropriate statutes, is that legally binding? Or is such a communication merely an interpretation or guidance issued by the agency without force or legal effect?

Facts of the Case

The Board of Pharmacy in a midwestern state issued a cease-and-desist letter to a business firm that sold animal supplies, including federal veterinary legend medications, to animal owners. It did require presentation of a prescription from a veterinarian for those medications subject to restricted, prescriptiononly distribution. The labeling of these medications bore the mandatory federal warning, "Caution: Federal law restricts this drug to use by or on the order of a licensed veterinarian."

The cease-and-desist letter cited specific provisions in state statutes that were allegedly being violated by the veterinary supply firm. The company responded by challenging the claim by the regulatory board that it had statutory authority over both human drugs and veterinary drugs prescribed by those authorized to practice on the respective populations, humans, and animals other than man. The Board of Pharmacy identified no rules or regulations in support of its position, and the firm made the connection of the Board's position back to wording posted on its Web site under a "Frequently Asked Questions" heading.

Q: Does an entity have to be licensed as a pharmacy to sell veterinary legend drugs to the consumer/ owner of the animal(s)?

A: Yes. Veterinary legend drugs may only be sold based on the order/prescription of a veterinarian. An entity may not sell veterinary legend drugs directly to the consumer (owner of the animal) based on a prescription without being licensed as a pharmacy.

The firm sought a declaratory judgment at the trial court level; ie, asking the court to declare what the law is on a specific point, that the Board had adopted a rule requiring all those who sell federal veterinary drugs to consumers to have a pharmacist present and to operate as a pharmacy subject to the jurisdiction of the Board. Further, the company sought a declaratory judgment that a rule like this is outside the statutory authority of the board, what the law refers to as being ultra vires, and was void and of no effect because it was promulgated without notice and hearing—mandatory steps before such a rule or regulation can be established. The Board argued that the information posted on the Web site was not a rule or regulation; it based its cease-and-desist letter on provisions in the state pharmacy practice act. The trial court ruled in favor of the veterinary supply company and the Board appealed to the state Supreme Court.

The Court's Ruling

The Supreme Court ruled that the response to the Frequently Asked Question the Board had posted on its Web site was not a rule or regulation under the law of the state. It merely was an expression of the Board's interpretation of the law without force or legal effect, an unenforceable suggestion. Because it was not a rule or regulation, the veterinary supply firm could not challenge its validity.

The Court's Reasoning

The judge writing the opinion for the Court emphasized that not everything written or published by a government agency is a rule or regulation. In this case, the Board had made no effort to follow the required procedures for promulgating a rule or regulation as mandated by the state's Administrative Procedures Act (APA). Such statutes are in effect in virtually every jurisdiction and outline the processes and procedures that must be followed by administrative agencies when doing what they do.

The Supreme Court made the direct statement that, "Here, the Board made no attempt to promulgate the frequently asked question as a rule pursuant to the requirements of the [APA]. It merely was an expression of the Board's interpretation of the law without force or legal effect," an unenforceable suggestion.

If one wants to challenge a rule or regulation adopted by an administrative agency, the attack could be based on lack of statutory authority by the agency to issue the rule, an argument that the rule conflicts with state statutes, or that the agency engaged in arbitrary and capricious action in adopting the regulation. None of those applied here because the rule or regulation had never been adopted; it was merely an interpretation advanced by the Board without force of law.

The court went on to rule that the case had been filed in the wrong county. Being a case against a state agency, such claims are required by state law to be filed in the county where the capital is located.

Dr. Fink is professor of pharmacy law and policy at the University of Kentucky College of Pharmacy, Lexington.