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Subject:    Advocates Cite Health Benefits In Bid To Preserve Novel Drug Take-Back Plan
Date Sent:    February 20, 2014

Environmentalists, local government organizations and the California attorney general are urging an appellate court to reject an industry challenge to a California county's novel pharmaceutical waste collection program, arguing the county has authority to establish the program and emphasizing the program's environmental and public health benefits.

The Natural Resource Defense Council (NRDC), California State Association of Counties (CSAC), the League of California Cities (LCC) and California Attorney General (AG) Kamala Harris (D) all filed amicus briefs late last month in Pharmaceutical Research and Manufacturers of America (PhRMA), et al., v. Alameda County, et al., where pharmaceutical manufacturers are asking the U.S. Court of Appeals for the 9th Circuit to declare an Alameda County drug take-back program unconstitutional because it places unnecessary burdens on interstate commerce.

The amicus briefs echo arguments made by Alameda County that local governments have the right to determine waste disposal requirements and that any cost to pharmaceutical manufacturers is de minimis compared to the program's health and safety benefits. But they also warn that if the district court's ruling supporting the program is overturned, that could threaten numerous other extended producer responsibility (EPR) programs in California and across the country.

The case's importance to the future of EPR programs has also been noted by its opponents, including free-market and industry groups that have argued the district court's endorsement of the precedent-setting approach could lead to the widespread transfer of local disposal costs to other industry sectors through an expansion of EPR programs.

EPR is a mandatory type of product stewardship that requires producers to be responsible for the post-consumer management of their products and packaging, including shifting financial and management responsibility away from the public sector.

At issue is Alameda County's first-in-the-nation 2012 ordinance requiring pharmaceutical companies whose products are sold in the county to establish, run and finance a drug take-back program for unwanted medications. Many local governments and citizen groups are concerned that a lack of such programs leads consumers to flush medications into wastewater systems, where they are eventually discharged and cause adverse developmental effects in fish and possibly humans.

But industry charges the ordinance violates the Constitution's Commerce Clause because it shifts the costs from a local program directly onto interstate commerce.

Judge Richard Seeborg of the U.S. District Court for the Northern District of California rejected industry's arguments against the Alameda County regulations, ruling the ordinance does not meet any of three criteria for proving a violation of the Commerce Clause: directly regulating interstate commerce, discriminating against interstate commerce, or favoring in-state economic interests over out-of-state interests.

Public Health

NRDC warns in its amicus brief that a ruling in favor of PhRMA would have long standing impacts on the work of health and environmental advocates, threatening their ability "to promote state and local extended producer responsibility programs that protect public health and the environment by making product manufacturers responsible for the entire lifecycle of their products, including their take-back, recycling and final disposal."

Additionally, NRDC writes that since 1991 at least 70 similar EPR laws and policies for multiple products have been enacted across the United States, making the approach commonplace despite industry's concerns.

In California alone, NRDC says, producers already are required to fund and manage end-of-life recycling and recovery programs for cell phones, thermostats, paint, carpets, mattresses and rechargeable batteries.

California's AG rebukes PhRMA for insinuating that the Alameda ordinance "runs afoul of the dormant Commerce Clause," and says her office filed the brief due to a strong interest in "ensuring that the dormant Commerce Clause continues to be interpreted in a way that preserves the abilities of state and local governments to adopt innovative programs to address threats to public health and welfare and the environment -- programs like Alameda's Ordinance." A number of the state's laws have been challenged recently under the Commerce Clause--including California's greenhouse gas reducing fuels regulation and a ban on shark fin sales-- which Harris says shows why the office has a strong interest in seeing the doctrine interpreted correctly.

Harris also notes the county's ordinance sets an important precedent for the state's EPR laws, especially since California is in the stages of implementing a Safer Consumer Products law, which she says will require manufacturers of certain products to establish and maintain end-of-life management programs that include comprehensive product stewardship plans.

CSAC and LCC in their joint brief say a ruling in PhRMA's favor would depart from long-established Commerce Clause jurisprudence. "PhRMA ignores controlling authority and asks this Court to adopt a rule that would invalidate a wide array of state and local laws, thereby curtailing the longstanding authority of state and local governments to regulate waste," the local government groups say.

Drug Collection

CSAC and LCC further defend Alameda County's right to mandate pharmaceutical companies, who sell products within county lines, to fund and collect used and unwanted drugs within its borders. Citing Maine v. Taylor extensively, the two associations argue that, "State and local laws imposing costs on manufactures to protect local residents from harms associated with products that arrive through a national chain of commerce involving multiple intermediaries are commonplace."

They also take issue with PhRMA's argument that "Alameda County is not exercising its authority over waste disposal, but is instead 'transferring its traditional police power responsibility of waste disposal to [private] interstate actors.'" The groups counter that the Commerce Clause does not control a government's decision as to whether government or the private sector should provide waste management services, and they cite Maine to reiterate that "the states retain authority under their general police powers to regulate matters of legitimate local concern, even though interstate commerce may be affected."

PhRMA, meanwhile, in a Jan. 31 response brief, acknowledges that Alameda has the authority to defray the costs of its medicine disposal program by collecting taxes and fees on sales and operate the program through its government, a system it says is comparable to waste collection programs across the country. But the industry group says the county violates the Commerce Clause because it mandates that pharmaceutical companies run the collection programs themselves.

"The county requires manufacturers who are located well beyond the County's jurisdiction and have no contact with the country," it writes, "to come into the county and develop, finance and operate a waste disposal program" which "forces these out-of-jurisdiction manufacturers to absorb all of the costs associated with this program and specifically prohibits them from recouping any or all of the costs of the program locally."

PhRMA argues the ordinance is illogical because it expects drug companies to engage in waste disposal functions "which they are neither equipped nor competent to perform." It alleges that Alameda and its supporters could not identify a "single precedent" that showed its novel ordinance was constitutional under the dormant Commerce Clause and that there's no precedent supporting the proposition that local governments can place total cost burdens of a program benefiting only local residents onto citizens located beyond the jurisdiction.

The ordinance, it writes "leverages the presence of an interstate product in the County to compel the product's manufacturer to enter the county and perform Alameda's public functions, regardless of whether the manufacturer has any other contract with the county."


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