Continue reading Vioxx settlement: February 4 update
I've previously discussed in passing the problem of federal criminal enforcement of drug marketing laws: the laws are so vaguely written, and the penalties so severe, that even a company that firmly believes it is in the right is likely to settle criminal litigation in order for huge sums to get charges knocked down to a misdemeanor:
Thus every investigation into pharma in the last decade by ambitious federal prosecutors has eventually led to a plea bargain on lesser charges... Prosecutors get a scalp and good headlines without having to risk a loss at trial, and corporate defendants pay the extortion.
Drug companies are reluctant to speak out for fear of being targeted. The District of Massachusetts Health Care Fraud Unit is especially notorious for overreaching: they bullied TAP Pharmaceuticals into a settlement for $885 million, but when they brought individual cases on the same allegations, all ten of the defendants were acquitted, including two from the bench. (Shelley Murphy and Alice Dembner, "All acquitted in drug kickbacks case", Boston Globe, Jul. 15, 2004; Harvey A. Silverglate, "Beantown Shakedown", WSJ, Jun. 24, 2005).
Thus, the news that that same unit has Merck before a federal grand jury investigating sales and marketing practices (WSJ; Pharmalot) is clearly not good news for Merck, whose investors can expect to be shaken down for nine or ten digits. Merck has already turned over every scrap of paper relating to sales and marketing in discovery in the civil case, however, so it is extraordinarily unlikely that the handful of federal prosecutors working on the case have seen something the hundreds of plaintiffs' attorneys reviewing the same documents have not; the effect on the civil cases will be more in terms of bad publicity than in substance.
(Similarly: Eli Lilly and Zyprexa [NY Times via Burch])
Update: Joan McPhee comments in the January 21 National Law Journal:
The government's recent aggressive campaign to prosecute and punish the dissemination of truthful, nonmisleading off-label information by pharmaceutical manufacturers provides a stark illustration. Not content to limit its prosecutions to false or misleading statements or other inherently wrongful conduct, the government has extended its theory of criminal wrongdoing to reach truthful, nonmisleading speech about a lawful activity that physicians routinely and responsibly engage in on a daily basis throughout the country — namely, off-label prescribing, often in circumstances in which the off-label use is not only medically accepted, but also the "standard of care" in the treatment of life-threatening illnesses such as cancer. This truthful, nonmisleading speech includes the dissemination of peer-reviewed journal articles and other scientific and medical research.
There is no one sitting in jail for being convicted of talking about potentially beneficial new medical therapies, and there is a dearth of legal precedent to support the government's overbroad theory of criminality. And yet, while there are strong legal and constitutional defenses to the government's attempted criminalization of truthful, nonmisleading off-label dissemination, there is no available avenue for targeted corporations to gain access to a judge or jury without risking corporate death akin to that of Arthur Andersen. And so they plead and pay, and the public shareholders and other corporate stakeholders pay the price, without benefit of anything even approaching the due process upon which we rightly rely for the fair resolution of legal disputes.
See also Tracy Miner in the Legal Times.
The tension between the interests of relatively strong and relatively weak claimants -- which helps to stretch legal ethics to the breaking point in the Vioxx settlement -- would be more manageable if we adopted the sensible incentives of loser-pays. Thus argues PoL's own Marie Gryphon in this new piece at City Journal.
It is a good sign for whether the 85% thresholds will be met that a group of Florida attorneys has, reports the AP, filed a motion begging to permit their clients to join the settlement, even though they are ineligible because they did not have pending litigation at the time of settlement. (Florida's statute of limitations has not yet expired.) In the words of the motion (docket #13286):
Continue reading Florida attorneys ask to expand Vioxx settlement
Two British doctors, writing in Lancet, note that the theories of cardiovascular risk attributable to COX-2s (e.g., Vioxx) are equally applicable to the over-the-counter NSAIDs (e.g., ibuprofen) on the market. After all, NSAIDs are also COX-2 inhibitors; the main difference between the two classes of drugs are that the COX-2 selective drugs do not inhibit COX-1, and thus have a gastrointestinal advantage. Drs. Warner and Mitchell theorize that NSAIDs and COX-2 inhibitors have identical cardiovascular risk profiles—a theory, one notes, that is consistent with Dr. David Graham's own dataset in his Lancet paper, though he made wild accusations about Vioxx despite the inconsistency with his own dataset's showing a lack of a statistically significant difference between COX-2s and NSAIDs's cardiovascular risk profile. (Timothy D Warner & Jane A Mitchell, COX-2 selectivity alone does not define the cardiovascular risks associated with non-steroidal anti-inflammatory drugs, Lancet 2008; 371: 270–73.) (h/t J.C.)
If so, the panic over Vioxx may well have taken a safer drug off the market while exposing consumers to worse health risks. Recall that serious ulcerations have increased 21% since Vioxx has been withdrawn from the market. The trial lawyers will still collect at least $2 billion for their role in this fiasco, but those who would have benefited from Vioxx and were injured by the substitution of an NSAID will not have a cause of action.
Continue reading Warner/Mitchell in Lancet: COX-2s no worse than NSAIDs
George Cohen's letter to the FTC (reported in today's New York Times) asking for antitrust review of the Vioxx settlement, is somewhat shorter than one might expect, and essentially recounts what he said at AEI two weeks ago. I repost it in its entirety below the jump, and will have more to say about the letter (and about Adam Liptak's article) next week.
Continue reading George Cohen's letter to the FTC re the Vioxx settlement
AP reports that at today's status conference, "lawyers have amended the November 2007 pact so that attorneys are directed to exercise their 'independent judgment in the best interests of each client individually before recommending enrollment in the program,'" which should resolve any remaining ethical ambiguity in the Vioxx settlement. "I'm satisfied that nothing in the agreement imposes on a lawyer any impermissible restriction on the practice of law," AP reports Judge Fallon saying. All objections have been withdrawn, though it is unclear whether that includes the pending Fifth Circuit appeal. I'll have more on the "tweaking" once I can evaluate it. The parties have reported that 57,167 plaintiffs have registered, and, so far, over 3000 of those have enrolled. The first enrollment deadline is February 29. Reuters has a short piece on today's hearing, also, and Pharmalot also repeats the AP account.
Update: I have posted the amendments which are, indeed, tweaks that accomplish the same end-result as the original settlement without running afoul of requirements that attorneys exercise their own individual judgment. The critical portion is Section 1.2.2, which modifies Section 188.8.131.52 of the original agreement. The other major change is that Judge Fallon has agreed to serve as the Chief Administrator.
(Bumped and expanded from Jan. 15 post.)
Ronald Benjamin, a Binghamton attorney for five plaintiffs, has filed a legally incoherent interlocutory appeal with the Fifth Circuit against an administrative discovery order (Pre-Trial Order No. 28) issued by Judge Fallon. (Agard v. Merck, No. 07-31164.)
Continue reading Fifth Circuit appeal in Vioxx litigation
Beck and Herrmann give a lengthy, but must-read, explanation why the esoteric 21 C.F.R. § 314.70(c)(6)(iii) is of critical importance in the ongoing question of whether state courts can penalize pharmaceutical companies for failing to contravene federal regulations—i.e., the question of preemption.
Speaking of preemption, January 18 is the day when the Supreme Court decides whether to grant cert in the important case of Wyeth v. Levine (May 22). As per usual, Beck and Herrmann have that well covered, too, with a post on the solicitor general's brief.
A status conference in federal court is scheduled for tomorrow in New Orleans. The parties today submitted a joint status report in advance:
Continue reading Vioxx roundup, January 17