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Recently in Vioxx/Drug Litigation Category


We were critical of the First Circuit decision in Bartlett v. Mutual Pharm. Co., and called for Supreme Court review. The Supreme Court today reversed the horrifically bad decision—but disturbingly, did so only on a 5-4 vote. [Scotusblog page]

Drug and Device Law Blog is sure to have interesting commentary, as they consistently have had during the case's pendency.

While there are those who complain that generic manufacturers get protection that other pharmaceutical companies do not, the problem arises because Wyeth v. Levine was wrongly decided. Unfortunately, the only legislative movement to correct the discrepancy would go in the opposite direction, resulting in a wealth transfer from consumers and government to wealthy trial lawyers, raising the cost of healthcare dramatically.

Accutane recusal motion update
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Not a gigantic surprise that the district court denied the motion to recuse in the Accutane litigation (earlier). Also not a giant surprise that Roche is appealing. Judge Higbee didn't help her case of claiming to be impartial by attempting to embarrass a Roche defense firm by incorrectly stating that their pro hac vice admission was revoked; the firm withdrew when it angered Higbee by asking a plaintiffs an embarrassing question about other risk factors for IBD. According to Roche, in fourteen trials over Accutane, plaintiffs are 9-4 with one mistrial, but five of the nine plaintiffs' verdicts have been reversed on appeal; it's unclear how many of the other concluded cases are pending on appeal. [NJLJ ($)]

Pharmaceutical company InterMune performed a study on an FDA-approved drug, Actimmune, to see if it could be used to treat chronic lung disease. The study results were mixed, but if one looked at a subgroup of patients with mild to moderate lung disease, the study showed a statistically significant benefit. CEO Scott Harkonen trumpeted these results in a press release—and faced criminal prosecution as a consequence. A jury agreed that the press release was fraudulent, and convicted him in 2009, though acquitted him on the government's off-label marketing charge. (One suspects this is indicative of a compromise verdict, but the press coverage doesn't say if this was raised at any point.)

On appeal, in an unpublished opinion, the Ninth Circuit refused to hold the press release protected by the First Amendment, pointing out that the jury found the communication false. Harkonen's attorney complains "Allowing the government to criminally prosecute and convict a speaker for expressing a scientific opinion with which the government disagreed represents a real sea change in the law." [Reuters]

The result confirms my fears about the narrow application of Caronia. Who is going to want to risk their freedom on whether a lay jury correctly assesses whether a statistical analysis is intellectually honest? (Most lawyers and judges aren't equipped to evaluate legitimate controversies over statistical analysis.) The effect will be disastrously chilling, and disincentivize the dissemination of scientific knowledge.

Isaac has already mentioned and linked to the motion, but it's worth noting that we were pointing out the plaintiff-friendly rulings of Judge Higbee back during the Vioxx litigation. E.g., October 2005, December 2005, April 2006, April 2006, August 2006, March 2007.

In the long run, it didn't make much of a difference in the results (Merck settled the Vioxx cases for a nuisance sum, and New Jersey appellate courts reversed the more ludicrous judicial rulings), but the good publicity from enormous jury verdicts helped attract thousands of new plaintiffs hoping for jackpot justice, ultimately adding to Merck's legal bills and the nuisance value of the set of cases. Hoffman-La Roche can't move to disqualify a judge just because the vast majority of her legal errors and rulings on discretionary questions favor plaintiffs, but Judge Higbee's lack of discretion in her extrajudicial comments may provide the hook they need to get fair trials in the future.

It's also worth noting that the Accutane cases are meritless. Yet oddly, when the pundits talk of a "War on Science," it's always in reference to a politic answer a Senator Rubio gives that acknowledges the religious faith of his constituents (and the vast majority of Americans), rather than junk-science litigation like this that actually interferes with science.

More on Caronia
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Scott Gottlieb notes the chilling effect of current DOJ policy. I still think he underestimates the incentives facing prosecutors and pharmaceutical companies in hoping for internal reform or successful pharmaceutical-company challenges; reform is going to have to come from the legislature or from higher up in the executive branch, and neither is likely in this administration or in a media environment that views pharmaceutical companies as evils to be barely tolerated rather than the major driver of healthcare innovation.

Earlier on POL; Bloom @ MPT; Pharmalot comes to the same conclusion I do: Caronia by itself won't change how pharma handles the issue; WSJ.

United States v. Caronia

The FDA approves drugs only for particular uses, but once a drug is approved as safe, doctors can use their medical judgment to prescribe them for whatever therapeutic purpose they wish. (Network newsmagazines sometimes try to pretend that this is a scandal, running fifteen-minute stories on the issue without once mentioning that it's entirely legal rather than the equivalent of a campus drug ring selling Ecstacy.)

Pharmaceutical companies sometimes run into trouble as a result; the FDA only allows them to advertise the drug for approved uses (accusing them of "misbranding" otherwise), and sales representatives earning commissions have the incentive to go outside of those regulatory bounds. Prosecutors strike hard when that happens, and the threat of debarment can extract billions of dollars from pharmaceutical companies whether or not they are culpable. The public policy problem is especially vexing when medical science is ahead of the regulatory decisionmaking. A pharmaceutical company is, according to the government, breaking the law if it truthfully states "Medical journal M published a study showing that drug D is effective in treating problem X," or even just distributes a copy of the published study. Forbidding the dissemination of truthful information has obvious First Amendment implications, but no pharmaceutical company dares litigate the issue: even aside from the possible consequences of bureaucratic retaliation by speaking out against regulators' power, the same threat of debilitating debarment makes it economically irrational to risk the randomness of the civil justice system, even if the drug company thinks it has a 95% chance of prevailing. This costs lives, as medicine moves faster than the over-cautious regulators do.

Until now. Alfred Caronia, a pharmaceutical sales representative, promoted the narcolepsy drug Xyrem to doctors for unapproved uses and subpopulations, such as "extended daytime sleepiness"—a use later approved by the FDA. His, employer, Jazz Pharmaceuticals, quickly settled for a $20 million fine, but Caronia faced criminal prosecution. He fought the law, was convicted, and appealed.

On appeal, argued in 2010, the Second Circuit reversed yesterday on First Amendment grounds in a 2-1 decision. Beck has thorough analysis that we won't repeat. Also: Gottlieb @ AEI; Bashman link roundup; and I'm sure MI's Medical Progress Today will have something to say.

Gottlieb writes that the decision "should prompt FDA to come up with a more balanced approach that allows findings from scientific studies to be disseminated even if these results aren't in the FDA-approved label and haven't met the agency's high bar." "Should," perhaps, but I'm skeptical about "will." The DOJ and FDA will fight Caronia through at least two more levels of appeal, and the economics of pharmaceutical companies refusing to fight the question means that the FDA and federal prosecutors have no incentive not to continue to overreach: they'll just bring their cases in one of the 47 states not bound by the Second Circuit.

The FDA approved Wyeth's hormone replacement therapy drug Prempro after its standard overrequired testing, but an expert witness testified in a Pennsylvania state court that Wyeth's failure to do "more" testing entitled a plaintiff to punitive damages, and a jury awarded a $10.1 million jackpot to plaintiff Mary Daniel, who implausibly blamed her breast cancer on 18 months of Prempro use. (Courts in places that aren't judicial hellholes throw cases like that out, since there's no competent scientific evidence that short-term Prempro use causes breast cancer.)

The trial judge did throw out $8.6 million of punitive damages on the grounds that Wyeth can't be blamed for making the same mistake the FDA supposedly did; but an appellate court reversed that decision and reinstated the jury verdict, and it's now in front of the Pennsylvania Supreme Court on a third level of review. Can courts apply a certain level of plausible common sense to the punitive damages inquiry, or is it sufficient for the testimony of a single expert gun for hire to expose a defendant to random punitive damages? Note that punitive damages here cannot affect pharma manufacturer behavior other than deterring new drugs in the aggregate: if punitive damages can be imposed because an expert says that the defendant should have done "more" testing, then plaintiffs will always find an expert willing to say another test should have been run in hindsight. [Legal Intelligencer via Bashman, who, alas, is arguing on the wrong side; Drug & Device Blog]

Drug & Device Blog notes further hellhole-ish shenanigans:

The basis for punitive damages was apparently failure to test - which doesn't even rate as an independent cause of action in Pennsylvania. Not only that, the plaintiff in Daniel got away with playing "hide the expert," resulting in the jury hearing the recorded opinion of an expert that the expert later testified he had recanted. Beneath all this was a moot footnote (choice of law not being disputed) that the law of the defendant's principal place of business (Pennsylvania has no tort reform whatever concerning punitive damages) should control for punitive damages purposes over the law of the plaintiff's state of residence, a distinct minority position.

The Pennsylvania Supreme Court is only reviewing the FDA defense, however.

On the other hand, if Pennsylvania courts are going to insist upon holding defendants to unreasonable standards at the same time that they're applying unreasonable choice-of-law standards, one wonders why pharmaceutical companies tolerate having their principal place of business in Pennsylvania when states like Texas or Michigan would be willing to accommodate them. Perhaps some companies find that the occasional arbitrary $10.1 million liability (combined with the expense of defense costs and multiplied over millions of potential plaintiffs who will forum shop for Philadelphia juries) is all worth it for the convenience of having offices in King of Prussia, Pennsylvania, and just views it as an odd local tax that largely benefits wealthy trial lawyers at the expense of the citizenry.

David Oliver has lots of good questions about the nonsensical Bartlett v. Mutual case that we discussed May 3.

Sulindac, like all NSAIDs, is capable of causing the rare (and horrific) reaction toxic epidermal necrolysis, and does so in about five or six patients a year. Nevertheless, the FDA, in evaluating the drug, recognized that the benefits outweighed the rare side effects, and approved the drug as "safe and effective." Karen Bartlett was in the very unfortunate one in a million, and suffered the rare side effect when she took generic sulindac. Her failure-to-warn theory was both a non-starter (her doctor never read the warnings) and, in any event, preempted by Pliva v. Mensing. But she was permitted to take a "design defect" theory to the jury. It's unclear how defendant Mutual Pharmaceutical was supposed to "design" sulindac differently; after all, it's a single molecule, and no one claimed that the inactive ingredients in the medication were at fault. But plaintiffs' theory was that the FDA was wrong, and that manufacturers should simply withdraw the drug from the market. A judge let this get to a jury, and let the jury consider the warning label in determining whether the drug was unreasonably dangerous, and, after the inevitable loss aversion bias kicked in, Mutual is now on the hook for $26 million. All this made possible by the Supreme Court's erroneous anti-business decision in Wyeth v. Levine. [Bartlett v. Mutual Pharmaceutical Co. (1st Cir. May 2, 2012) (via Bashman)].

Beck calls for Supreme Court review. I agree.

(Looking for good links on NSAIDs and SJS, I found that the search-engine-optimized websites for Stevens-Johnson Syndrome are all trial-lawyer sites, natch, with misleading names like "Skin Association.")

In The American Conservative, Ron Unz compares the Vioxx litigation to the Chinese melamine scandal, and finds the American justice system lacking. (Also: Sailer; Roberts; and a plaintiffs' lawyer who makes the lay mistake of confusing a mass tort with a "class action".) But Unz's entire argument is based on an incorrect premise. Unz assumes that David Graham is correct in implying that Vioxx had "probably been responsible for at least 55,000 American deaths during the five years it had been on the market." But Graham is not. While Graham's text in the Lancet made wild allegations, the headlines were not supported by his underlying data, which found a relative risk of low-dose Vioxx of 1.24, which was not statistically significant. A later Lancet study confirmed that Vioxx and other COX-2s were no worse than other NSAID pain relievers when it came to cardiovascular risk.

And, of course, Vioxx was not merely a product of corporate profit-seeking; it had benefits over other pain relievers. Since Vioxx has been withdrawn from the market, serious ulcerations have increased 21%.

Merck's total legal bill for Vioxx is in the range of $8 billion and counting, though it correctly won the vast majority of cases taken to final judgment; the only ones it lost, it lost due to junk science. Merck's experience with Vioxx is certainly a damning indictment of the American justice system, but for reasons opposite than the ones Unz thinks.


POL Columns

Taking stock: a quarter century of product liability defense

The Vioxx Litigation

Rule of Law: Ambush In Angleton


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.