Results matching “Calfee”

Obamacare SCOTUS-bound? - PointOfLaw Forum

The government surprised some people by not trying delay Supreme Court consideration of the Eleventh Circuit decision holding PPACA partially unconstitutional, but I think Todd Gaziano has it right: the government couldn't expect a better result from the Eleventh Circuit, and, with the 2012 election up in the air, the administration may well have preferred to have its own solicitor general arguing the case than risk the sort of shenanigans created by this administration's politicized decision to sabotage the defense of DOMA in pending constitutional litigation. Cert petitions: NFIB; DOJ; Thomas More; DOJ response to Thomas More; Florida and other states.

To this, we can add the cynical Mickey Kaus analysis: the administration may well prefer to have Obamacare struck down before the 2012 election. Not only does an adverse decision diffuse one of the strongest sources of anger against Obama, as Kaus notes, but any reversal would be 5-4, and permit Obama to run against the Supreme Court the way he attempted to do in 2010 over Citizens United. And the more likely scenario of a Supreme Court win would likely have a politically mollifying effect on independent voters who are generally indifferent about Commerce Clause issues; voter ignorance about the role of the Supreme Court (combined with the media's general laziness in reporting Supreme Court jurisprudence as a political decision) would result in the majority of voters treating the Supreme Court decision as a ratification of the underlying PPACA policy decisions, making it an unprofitable issue for Republicans in the election. (Which may well already be true if Romney is the Republican nominee, given that Romneycare inoculates Obamacare from criticism.

Meanwhile, the DC Circuit heard argument on PPACA on the 23rd; the DC Circuit can't resolve the circuit split, so its decision will be little more than amicus briefs by the various opinion-writing judges, and it got little press coverage. But for some interesting examples of eye-of-the-beholder observation, compare the liberal Simon Lazarus to the libertarian Randy Barnett covering the same argument.

The D.C. Circuit argument presents two questions that neither side has adequately answered. First, how can the claim PPACA is unconstitutional be reconciled with Wickard v. Filburn, the Supreme Court case exemplifying the high-water mark of Commerce Clause jurisprudence? Randy Barnett certainly has a creative theory, but the better answer may well be Richard Epstein's: Wickard is wrong. But given that Gonzales v. Raich was 6-3, I don't see five (or even four) votes for reversing Wickard. But the government may just be able to pull defeat from the jaws of victory, because, when asked to define a limiting principle for the Commerce Clause, the government has steadfastly refused to do so (much as Justice Kagan refused at her confirmation hearing). While there are likely four votes on the Court for unlimited congressional Commerce Clause powers, the government needs a stronger argument to guarantee a fifth vote.

That said, I count the four Democratic noses to uphold PPACA against any challenges, only two votes (Thomas's and Roberts's) that are very likely to vote against doing so, and three votes—Scalia's, Alito's, and Kennedy's—whose view of the Commerce Clause question that Randy Barnett presents will be completely unknown. Add to that the possibility that you could find five votes to punt the question entirely by holding early challenges barred by the Anti-Injunction Act (imagine how that decision will be covered by the news media), and it seems the odds are against this Supreme Court striking down PPACA in 2012.

I discussed these issues with Vicki McKenna on WIBA on September 27.

More: Ilya Shapiro.

Paul Rubin blogging - PointOfLaw Forum

Important tort-reform scholar Paul Rubin is now blogging at Truth on the Market. His first post remembers Jack Calfee. We're just sorry we didn't get him first, but are happy to hear from other conservative and libertarian law professors and lawyers who want to blog on law and public policy, especially civil-justice-reform issues.

Jack Calfee's last op-ed - PointOfLaw Forum

With the assistance of his daughter, the late Jack Calfee's last op-ed makes it into the WSJ ($), and its analysis of MassCare is bad news for Mitt Romney—as well as the rest of the United States if the same flawed problems of the PPACA end up dictating the health economy of the nation.

Others comment on Calfee: David Henderson; Chris DeMuth.

RIP Jack Calfee - PointOfLaw Forum

Sadly, economist Jack Calfee passed away unexpectedly from a heart attack Wednesday night. He had written for Point of Law about the Vioxx litigation, and we frequently cited him about drug and vaccine regulation and litigation. Calfee also did important work on non-economic damages in the 1980s and 1990s. He had moderated panels for me and vice versa when I was at AEI; he was also a client. Jack will be missed, both as a scholar and as a friend. I'm sorry that I will miss his memorial service because of a preexisting commitment in California. Other memories: Sam Kazman; Tevi Troy; John Graham; Galen Institute.

Around the web, October 16 - PointOfLaw Forum

Roundtable: conflicts of interest and medicine - PointOfLaw Forum

The teaching hospitals associated with Harvard Medical School recently issued a directive forbidding top personnel from involving themselves with private health-care companies in various ways, as by accepting seats on the boards of drug companies. The Manhattan Institute's Medical Progress Today site assembles a roundtable on this topic that draws on a glittering display of talent, including Jack Calfee (AEI), Richard Epstein (Chicago), Thomas Stossel (Brigham & Women's), Thomas Huddle (U. of Alabama), Rita Numerof (Numerof & Associates), Lance Stell (Davidson College), and Elizabeth Whelan (American Council on Science and Health).

Waxman report on drug preemption - PointOfLaw Forum

Beck and Herrmann give it a much deserved skewering (more skewering from former FDA official Sheldon Bradshaw at American Lawyer; and background). John Calfee has a new Health Policy Outlook for AEI with a calmer and more reasoned view:

These analyses [by JAMA and New England Journal editorialists, among others] largely ignore three crucial points. First, the liability system is a clumsy tool that can easily do more harm than good, and its record in the pharmaceutical market is particularly bad. Second, the FDA faces powerful incentives to overregulate and overwarn, meaning that warnings and contraindications imposed by litigation will usually impede--rather than improve--medical care. Finally, contraindications imposed through litigation (as in Wyeth v. Levine) are especially likely to leave patients worse off.

White Coat Rants has been writing persuasively (here and here) about the harmful effect on medical practice of a plaintiff victory in Wyeth v. Levine.

Beck & Herrmann also have a new post up providing a comprehensive look at Wyeth v. Levine and the implied drug preemption issue, broadly taking the view that a defense victory at the high court would be 1) less sweeping in forestalling future mass tort claims than is often assumed, but 2) more difficult for Congress to override than the express pre-emption that came up in Riegel. One of the points they make adds perspective to the oft-touted endorsement of the plaintiff's case by NEJM and JAMA: both doctors and drugmakers are often defendants in these cases, and the effect of sticking the latter with more of the liability will often be to stick the former with less of it. (In other words, the doctors have reason to throw the drugmakers under the bus; put differently, the Litigation Lobby is great at playing "divide and conquer".) B&H also recently cautioned against too ready a concession to the claim that pharmaceutical tort litigation actually has a favorable effect on safety in the first place, the evidence for which appears surprisingly sparse.

A Congressional Response to Riegel v. Medtronic - PointOfLaw Forum

From Congress Daily:

Democrats rankled by a recent Supreme Court decision shielding medical device companies from state liability lawsuits plan to unveil legislation to reverse the ruling, the first of many expected efforts to chop away at federal rules that restrict consumers' ability to sue.

House Energy and Commerce Health Subcommittee Chairman Frank Pallone, D-N.J., and House Oversight and Government Reform Chairman Henry Waxman will introduce legislation before the Independence Day recess that would explicitly state that FDA regulation does not trump medical device patients' ability to seek damages under state law, a Pallone spokesman said.

A generally thorough article, although we would certainly disagree that business' strategy is to "bash the trial lawyers." The case for federal preemption can be argued quite effectively on its merits.

See previous posts, including Ted Frank on the Supreme Court's ruling in Riegel v. Medtronic, James Copland in The Washington Post on federal preemption, and testimony to Waxman's committee by John Calfee of the American Enterprise Institute, who argued that the lack of federal preemption would create worse markets for pharmaceuticals and harm patients on the whole. (Cited in this post.)

Federal Preemption, the Hearing - PointOfLaw Forum

The House Committee on Oversight and Government Reform held a hearing yesterday on federal regulation of medical devices, a session meant to set the stage for reversing federal preemption of state regulations -- such a reversal being a priority for trial lawyers wanting to sue in state courts.

Testimony by Dennis Quaid -- you remember, the actor? -- got the most attention, even showing up on local news broadcasts in D.C. Quaid and his wife are suing Baxter Healthcare for a Heparin overdose given to their twin infants.

We commend the testimony of John E. Calfee, Ph.D., of the American Enterprise Institute. You can read Calfee's conclusions here. Bottom line: Eliminating pre-emption will encourage litigation, an ineffective and expensive approach of promoting safety or advances in prescription drugs.

And for a classic example of one-side reporting, read this AP scene-setter, an article that accepts the thesis from the activists (trial lawyers and self-styled consumer groups) that the Bush administration is using regulations to lock in federal preemptions, sticking it to the little guy in the process. Five separate people are cited complaining about pre-emption, "balanced" by two people making neutral observations about the legal and political landscape. Did no one make a positive case for federal preemption?

P.S. Ah, we see the AP reporter reported on the committee hearing from the same vantage point, that of doubting preemption.

An important all-day conference at AEI next week:

In the last several years, nearly every major pharmaceutical company has paid hundreds of millions of dollars to settle allegations of illegal "off-label" marketing of drugs. There has been a growing trend of actions by federal prosecutors, state attorneys general, and cooperating trial lawyers to litigate against pharmaceutical manufacturers for allegedly doing too much to promote off-label use of prescription products. Citing recent legal changes mandating exclusion from federal programs after a conviction, many manufacturers say they are forced to settle rather than risk defending themselves--even as prosecutions against individual executives have foundered in front of juries.

At this AEI Legal Center event, experts on both law and health care will present papers on the law, economics, medicine, and public policy of off-label marketing, discussing everything from the abuse of class action mechanisms to implications for the First Amendment and medical malpractice. Speakers include former Food and Drug Administration chief counsel Daniel Troy; former Cephalon general counsel John Osborn; former deputy attorney general George Terwilliger; principal deputy assistant attorney general and acting assistant attorney general for the Civil Division Jeffrey Bucholtz; attorneys Brian Anderson, James Beck, Mark Herrmann, Richard Samp, and Kyle Sampson; law professor Margaret Johns; and AEI scholars John E. Calfee, Theodore H. Frank, and Scott Gottlieb.

Panel I: Off-Label Marketing, R&D, and Medical Practice

Panel II: The Legal Environment from Federal Regulation and Enforcement

Panel III: Distortions from State and Private Enforcement

Panel IV: Legal Implications for Commercial Speech and Medical Practice

Register here. Earlier discussion on POL: Feb. 1; Feb. 19; Mar. 24; Dec. 17; Aug. 31; Aug. 22 (Richard Epstein); Aug. 1, 2006 (state AGs); Mar. 19 (InterMune indictment).

January 7: Vioxx Settlement panel at AEI - PointOfLaw Forum

Please register for this event online at

The AEI Legal Center for the Public Interest and the Federalist Society present:

The Vioxx Settlement

Monday, January 7, 2008, 12:00 p.m.�2:00 p.m.
Wohlstetter Conference Center, Twelfth Floor, AEI
1150 Seventeenth Street, N.W., Washington, D.C. 20036

In 2004, Merck withdrew its pain reliever Vioxx from the market because of new studies showing increased cardiovascular risk. Merck announced that it would not settle any of the tens of thousands of Vioxx lawsuits filed, and set aside over a billion dollars to litigate cases without reserving a penny for damages. After a $254 million verdict in the first Vioxx trial in 2005, some observers predicted over $25 billion in liability for the company. Fifteen trials later, Merck and the plaintiffs� attorneys announced a settlement of the outstanding personal injury litigation�for under $5 billion. Merck stock rose after the announcement, and is now higher than before it withdrew Vioxx from the market. But some law professors are arguing that a new and unusual provision in the settlement raises ethical concerns.

Why did Merck settle? And why was the settlement for so much less than originally anticipated? Is the Merck settlement different from the Wyeth fen-phen settlement, which was originally announced as a $3.75 billion settlement, but has so far cost more than $20 billion? Will the settlement stand up under legal challenge, and what will remain of the Vioxx litigation if it does?

At this event cosponsored by AEI and the Federalist Society, a panel of experts will explore these and other questions. Speakers include Vanderbilt law professor Richard Nagareda, author of Mass Torts in a World of Settlement; Virginia legal ethics professor George Cohen; author and leading pharmaceutical mass torts defense attorney Mark Herrmann; Andy Birchfield, a member of the Vioxx Plaintiffs� Steering Committee; and Ted Frank, director of the AEI Legal Center for the Public Interest. AEI resident scholar John E. Calfee will moderate.

11:45 a.m.
Registration and Lunch

12:00 p.m.
Andy Birchfield, Beasley Allen
George Cohen, University of Virginia School of Law
Ted Frank, AEI
Mark Herrmann, Jones Day
Richard Nagareda, Vanderbilt University Law School

John E. Calfee, AEI

2:00 p.m.

Trial lawyer earmark in FDARA? - PointOfLaw Forum

AEI's Scott Gottlieb, the former FDA commissioner, writes in the Wall Street Journal:

Democrats staged an 11th-hour showdown this week over a bill that funds the Food and Drug Administration (FDA). Their aim: a huge handout to the trial bar.

The furtive give-away is buried in the Food and Drug Administration Revitalization Act (FDARA), a funding bill that needs to pass this week if the agency is to avoid a budget crunch that could force it to fire its drug reviewers. If drug safety is so critical, why would Democrats risk issuing pink slips at the FDA? The provision raises the question of whether the hyperbole and hearings over drug safety these past several years was about improving public health, or merely paying off the lawyers.

The key issue is whether state courts should second-guess FDA scientific decisions that are based on an exhaustive review of clinical data and the proposed drug labeling. This usually comes up when drug companies are alleged to have failed to warn consumers about emerging drug safety issues, which comprise the vast majority of product liability cases.

Companies and the FDA (under both Republican and Democratic administrations) have argued that when the FDA specifically addresses a safety issue -- often telling companies that they can't include certain warnings in drug labeling because it's not scientifically justified -- state courts are "pre-empted" from and have no business substituting their judgment for the agency's expert finding. Otherwise, drug labeling -- which is an important public health tool -- would get cluttered with dubious and confusing warnings aimed at only shielding firms from lawsuits.

One recent case where pre-emption was successfully asserted was Dowhal v. SmithKline Beecham in California. The company was sued for failing to warn consumers that nicotine-replacement products allegedly cause birth defects, even though there wasn't any credible scientific evidence establishing that link. The FDA not only forbade SmithKline Beecham from including the superfluous warning in the drug's label, it also said that the public health was best served by encouraging pregnant woman to use nicotine replacement instead of smoking.

A California court initially said that more warnings were always better. Fortunately, after the FDA asserted that its judgment should prevail, the California Supreme Court unanimously agreed.

Relatedly, AEI's Jack Calfee critiques FDARA.

September 25: Patent Reform Act of 2007 event - PointOfLaw Forum

The AEI Legal Center for the Public Interest is featuring two panels on patent reform on September 25, in conjunction with the new monograph by AEI's Jack Calfee and Claude Barfield, Biotechnology and the Patent System. Speakers include the general counsels of Cisco, Eli Lilly, and AmberWave.

"Drug Dilemma" - PointOfLaw Forum

AEI's Jack Calfee gives Richard Epstein's new book Overdose a sterling review in the New York Post.

Epstein hits just about every issue in today's intense debate over the pharmaceutical industry: patent rights, prices and price controls, drug importation at bargain-level foreign prices, R&D incentives and the role of government, FDA regulation (including drug-safety oversight), drug marketing and its many critics and tort liability.

New column: Jack Calfee on Vioxx - PointOfLaw Forum

The AEI scholar reflects on the painkiller litigation in our newest column. If you're late to the subject, we've got a category on it.

Rein in the Monster - PointOfLaw Columns

By John E. Calfee

(Reprinted from The New York Sun, April 12, 2006)

On April 11th, 2006, a New Jersey jury added $9 million in punitive damages to $4.5 million in compensation it had awarded to John McDarby, a 77-year-old man who had sued the drug manufacturer Merck after suffering a heart attack while taking the pain reliever Vioxx. That verdict did not tell us much about Vioxx, Merck, and even the Food and Drug Administration, but it certainly provided a lot of unpleasant news about the tort system.

Essentially, the jury had to decide three things. One was whether Vioxx was a substantially contributing factor to the heart attack suffered by an elderly ex-smoker with diabetes and coronary artery disease. Unfortunately, science can't give us a good answer. Mr. McDarby was clearly at great risk for a heart attack. But there is no way to know which of a multitude of precipitating factors tipped the balance on that terrible day. We don't even have reliable data indicating an extra probability of a heart attack in the relevant circumstances. The plaintiff lawyers simply dismissed the fact that after combing through a massive literature, the FDA concluded that traditional anti-inflammatories like Advil and old prescription drugs (called nonsteroidal anti-inflammatory drugs), as well as Vioxx and its modern competitors (like Celebrex), all probably involve a heart attack risk which remained largely undiscovered until large-scale clinical trials were run on Vioxx and its competitors.

The jury simply had no way to determine whether the plaintiff would have had a heart attack if he had used a different pain reliever. Relying on an unpredictable mix of intuition and emotion, the jury simply guessed.

The second issue was failure-to-warn. The plaintiff argued that in addition to complying with all FDA regulations about warnings, Merck should have specifically warned the doctor not to prescribe Vioxx to this patient. What warning, we should ask, and to what effect? Here, the jury had even less foundation than when deciding causation. The most important data about Vioxx and heart attacks had long since been published and widely discussed in medical circles. Moreover, Vioxx was a lifesaver for patients with a propensity toward fatal ulcers, which every year kill thousands of patients taking older drugs that Vioxx replaced. Whether more warnings would have pushed the patient toward more safety or just rearranged Mr. McDarby's numerous various risk factors was something the jury could not possibly discern. No scientifically based warning could have said something like "there is a so-and-so percent extra chance of a heart attack." A warning would presumably have said something like "don't prescribe this to patients with a high risk of heart attack," but what good would that have done in the absence of information about whether the obvious alternative treatments were better?

Again, the jury had to guess. And again, there is no reason to think its guess would have been better than the FDA's own expert assessment.

The third question was whether to award punitive damages, something never before done to a pharmaceutical manufacturer liability case in New Jersey. Under New Jersey law, the jury had to find that Merck had withheld information from the FDA in a "wanton and willful" manner. Again, a problem for the jury was the FDA itself. As a former FDA staffer testified, the FDA was satisfied that Merck had turned over all the information it needed. How did the jury reach a conclusion so different from the FDA's own? Here lies one of the most unsettling parts of this trial. Merck, like all responsible manufacturers, massaged the Vioxx data as it arrived, trying to get a fix on the true heart-attack risk and other matters in a diverse mix of patients. The FDA has to know that firms do that kind of analysis all the time. The jury said Merck should have shared its own preliminary assessment of the data with the FDA even though the FDA famously makes up its own mind about such things and the underlying data had in fact already been given to the FDA. Had Merck not undertaken its analysis, there would have been nothing to keep from the FDA. The lesson for Merck and the rest of the industry is that mulling over safety data can get you in legal trouble even when the FDA has no interest in the hundreds of spreadsheet calculations that necessarily arise.

Now, if we ask a jury to do the impossible, we're asking for trouble. And if we ask it to do the impossible with tens of billions of dollars in the balance, we're asking for big trouble. Yet that's what we did last week in that New Jersey courtroom. Does this mean we should junk the liability system, at least for pharmaceuticals? Not at all. The system works reasonably well for outlier situations such as intentionally hiding essential information from the FDA and others, or marketing drugs that clearly fail a cost-benefit test while withholding exactly the information that would have disclosed that fact. But today's system cannot work well for close calls, at least not when the stakes are in the billions or tens or hundreds of billions of dollars. Analysts expect tens of thousands of cases roughly similar to Mr. McDarby's. Juries will continue to guess at the central issues, getting it wrong as often as right but charging Merck $10 million or $20 million or $40 million every time they're wrong. A thousand mistakes is $10 billion to $40 billion. And a lot of states make it easier than New Jersey does to award punitive damages.

Nor is Vioxx the only drug where this perverse logic could play out. The liability plaintiff bar is honing the same methods for other drugs where similar imponderables can generate $10 million guesses.

What to do? There is a simple way to keep these questions out of the reach of juries. The states can do what the FDA has already suggested they do: Stop letting plaintiff lawyers seek huge awards for behavior that actually complies with the FDA's regulations and findings of fact. With lawyers bringing thousands of cases before juries that read about the evils of the drug companies every day and then have to decide the central issues through guesswork, we are now creating a monster. It is time to rein that monster in.

Vioxx guesswork, times billions - PointOfLaw Forum

AEI's Jack Calfee:

The jury simply had no way to determine whether the plaintiff (77-year-old coronary artery disease and diabetes sufferer John McDarby) would have had a heart attack if he had used a different pain reliever. Relying on an unpredictable mix of intuition and emotion, the jury simply guessed....

Analysts expect tens of thousands of cases roughly similar to Mr. McDarby's. Juries will continue to guess at the central issues, getting it wrong as often as right but charging Merck $10 million or $20 million or $40 million every time they're wrong. A thousand mistakes is $10 billion to $40 billion. And a lot of states make it easier than New Jersey does to award punitive damages.

(via sister site Medical Progress Today)

"The Cutter Incident" on C-SPAN2 - PointOfLaw Forum

Tomorrow's AEI event on The Cutter Incident will be broadcast live on C-SPAN2 at 10 am.

Two events which took place in the mid-1950s have exerted since then an extraordinary influence over health care. The first event was the development of an effective vaccine against polio, a scientific triumph over a fearsome communicable disease that had crippled or killed thousands of people annually, including future president Franklin D. Roosevelt. The second event was the litigation over an imperfectly prepared polio vaccine which caused injuries or death to hundreds of children�an event now known as the Cutter Incident. The Cutter litigation has played a pivotal role in changing the products-liability system to a liability-without-fault standard in which manufacturers must pay for damages, even in the absence of negligence.

In his book The Cutter Incident : How America's First Polio Vaccine Led to the Growing Vaccine Crisis (Yale University Press, 2005), Paul A. Offit provides a fascinating narrative of these two seminal events and concludes that this unfortunate turn in liability law has reduced today�s vaccine supply and, most importantly, has retarded the development of new vaccines. The author�s presentation will be followed by a discussion with Randy Bovbjerg of the Urban Institute and AEI resident scholar John E. Calfee.

Previous PoL coverage: Feb. 28; Apr. 3.

One of the arguments for medical malpractice reform is that excessive liability serves to drive doctors out of the market for performing procedures with malpractice risk, and reduces access to health care. While this proposition makes sense as a matter of basic economics, there has been very little empirical study of the subject. On April 5, two economists who have previously done work in the area, David Dranove and Jon Klick, will be presenting new papers with their latest results. Randy Bovbjerg of the Urban Institute and I will be commenting; AEI's Jack Calfee will moderate. Register for the event here; the page will also eventually have a web-cast.

The Federalist Society is sponsoring a debate today on this topic at Ave Maria Law School (being webcast live now), featuring AEI scholar Michael Greve, former FDA General Counsel Dan Troy, and Professors Peter Hammer and Lars Noah.