Drug & Device News

Feds Put Pressure on Medical Marijuana Dispensaries' Landlords

Arcata, CA, attorney Steven Schectman has filed suit in federal court against the Drug Enforcement Administration (DEA), alleging the agency violated the civil rights of so-called 'pot club' owners when it sent threatening letters last year to California landlords who rent to the marijuana dispensaries. The letters, which told the landlords that 'federal law takes precedence over state law,' informed the landlords that the DEA considers it a federal crime to aid drug-selling businesses and that Proposition 215 ' which in 1996 legalized medical marijuana in California ' will not be accepted as a defense to protect them from authorized penalties of up to 20 years in prison and the loss of their property.

Landlords have understandably become nervous, evicting some pot club tenants, but lawyers like Schectman are helping the clubs fight back. He has already successfully defended one such club, the Arts District Healing Center, from an eviction attempt prompted by one of the DEA's letters. The judge in that case held that the landlord had no legitimate basis for the eviction as the tenant was in compliance with the terms of its lease.

Joseph Russoniello, U.S. attorney for California's Northern District, says that 'prosecuting medicinal providers is low [priority] if they're true caregivers.' The definition of a true caregiver, according to Russoniello, is that the facility operates 'at cost with no profits' and has a small staff. He said large, profiteering commercial operations 'do not meet my definition of low priority,' but Russoniello added that these sentiments should not be taken to mean that an imminent crackdown by the U.S. attorney is in the offing.

Drug Companies Settle Price Inflation Class Action Suit

Eleven pharmaceutical companies have settled for $125 million the class action brought against them in U.S. District Court in Massachusetts over their alleged inflation of prescription drug wholesale prices. The suit, In re: Pharmaceutical Industry Average Wholesale Price Litigation, M.D.L. No. 1456, No. 01-12257 (D. Mass), was brought by consumers and insurance companies who said the drug manufacturers fraudulently inflated published average wholesale drug prices in order to reap greater profits than they were entitled to. Under the terms of the settlement, 82.5% of the settlement fund is earmarked for third-party payors' or insurance company claims and 17.5% for consumer claims. The companies that settled on March 7 include: Abbott Laboratories; Amgen Inc.; Hoechst Marion Roussel; Baxter Healthcare Corp.; Baxter International Inc.; Bayer Corp.; Dey Inc.; Fujisawa Healthcare Inc.; Fujisawa USA Inc.; Immunex Corp.; Pharmacia Corp.; Pharmacia & Upjohn; Sanofi-Aventis; Sicor Inc.; Gensia Inc.; Gensia
Sicor Pharmaceuticals Inc.; Watson Pharmaceuticals Inc.; and ZLB Behring.

FDA to Expand Reach into China

The FDA announced March 14 that it is planning to establish eight full-time permanent FDA staff positions in the People's Republic of China and will hire an additional staff of Chinese nationals to bolster their efforts to ensure the safety of Chinese drug product imports to the United States. There has been a spate of tainted products imported from China into the United States in the past few years, ranging from drugs and food to children's toys.

Of particular recent concern to the FDA has been the introduction of contaminants into a Chinese-made component of the blood-thinning agent heparin. That ingredient was imported into the United States, where pharmaceuticals manufacturer Baxter International Inc. assembled the final product for distribution. Because of the Chinese-manufactured tainted heparin ingredient, Baxter earlier this year had to recall all lots of its heparin sodium injection multi-dose, single-dose vials and HEP-LOCK heparin flush products.

Elidel Failure-to-Warn Cases Go Forward, with Some Pauses

Following the FDA's Jan. 19, 2006, warning that some users of eczema drug Elidel' reported developing skin cancer and lymphoma, suits against the manufacturer, Novartis Pharmaceuticals Corp., began to pile up. Sixteen cases are now pending in New Jersey federal court, all charging that Novartis knew of the risks as early as 2001, but concealed them from the public and the medical community. The plaintiffs, including some children, claim they developed various forms of cancer, including Hodgkin's disease, non-Hodgkin's lymphoma, skin cancer, leukemia and rhabdomyosarcoma, a cancer of the skeletal muscles.

The issue of federal preemption of state claims is holding up some of the cases in district courts at this point. The question is currently being considered by the Third U.S. Circuit Court of Appeals, which heard arguments last Dec. 10 in a pair of cases that could resolve the pre-emption issue. They are McNellis v. Pfizer Inc., 06-5148, in which a federal judge in New Jersey held that FDA drug-labeling regulations do not conflict with state tort laws that impose liability for failure to warn of known product risks; and Colacicco v. Apotex, 06-3107, in which a Philadelphia federal court ruled that federal preemption applied to Pennsylvania's failure-to-warn laws. While the lower courts await an answer from the Third Circuit, some Elidel proceedings have come to a halt. Wrote U.S. District Judge Jerome Simandle in Linkenmeyer v. Novartis Pharma- ceuticals and Anderson v. Novartis Pharmaceuticals, 07-1657, in his order staying two such cases before him: 'With both those cases [McNellis and Colacicco] pending before the Court of Appeals, it is all but certain that a forthcoming decision by that court will be dispositive of some of the issues.'

Plaintiff Who Keeps Mum About Damage Amount Can't Avoid Fed Court

A plaintiff who wanted her products liability suit ' based on injuries she says were caused by a birth control device ' remanded to state court has lost her bid by failing to stipulate that she would not seek more than $75,000 in damages. The plaintiff, Carmita T. Purdiman, used the NuvaRing birth control device for just one month before she developed a pulmonary embolism, which can lead to blood clots. After she was seen in her hospital's emergency room, her condition required her to remain in the hospital for a week. Claiming she must now take blood thinners, submit to weekly testing and be closely monitored in the future for what she terms a permanent condition, the plaintiff sought medical expenses, future medical expenses, lost wages, and pain and suffering. The defendants, Organon Pharmaceuticals USA Inc. and Organon International Inc., removed the suit to federal court based on diversity of citizenship and an amount in controversy in excess of $75,000.

The plaintiff sought remand, saying the defendants had failed to prove by a preponderance of the evidence that the amount in controversy exceeds $75,000, although she refused to specify an amount of damages and would not sign an affidavit stating she would not seek damages in excess of $75,000. The court used what it termed its own 'common sense and experience' to find from the pleadings that the amount in controversy more likely than not would exceed $75,000, what with the prolonged hospital stay, lost wages, future medical monitoring, etc. Thus, it held that defendants had met their burden to prove by a preponderance of the evidence that federal jurisdiction was appropriate in the action. The case is Purdiman v. Organon Pharmaceuticals USA Inc., Slip Copy, 2008 WL 686996 (N.D.Ga., 3/12/08).

Feds Put Pressure on Medical Marijuana Dispensaries' Landlords

Arcata, CA, attorney Steven Schectman has filed suit in federal court against the Drug Enforcement Administration (DEA), alleging the agency violated the civil rights of so-called 'pot club' owners when it sent threatening letters last year to California landlords who rent to the marijuana dispensaries. The letters, which told the landlords that 'federal law takes precedence over state law,' informed the landlords that the DEA considers it a federal crime to aid drug-selling businesses and that Proposition 215 ' which in 1996 legalized medical marijuana in California ' will not be accepted as a defense to protect them from authorized penalties of up to 20 years in prison and the loss of their property.

Landlords have understandably become nervous, evicting some pot club tenants, but lawyers like Schectman are helping the clubs fight back. He has already successfully defended one such club, the Arts District Healing Center, from an eviction attempt prompted by one of the DEA's letters. The judge in that case held that the landlord had no legitimate basis for the eviction as the tenant was in compliance with the terms of its lease.

Joseph Russoniello, U.S. attorney for California's Northern District, says that 'prosecuting medicinal providers is low [priority] if they're true caregivers.' The definition of a true caregiver, according to Russoniello, is that the facility operates 'at cost with no profits' and has a small staff. He said large, profiteering commercial operations 'do not meet my definition of low priority,' but Russoniello added that these sentiments should not be taken to mean that an imminent crackdown by the U.S. attorney is in the offing.

Drug Companies Settle Price Inflation Class Action Suit

Eleven pharmaceutical companies have settled for $125 million the class action brought against them in U.S. District Court in Massachusetts over their alleged inflation of prescription drug wholesale prices. The suit, In re: Pharmaceutical Industry Average Wholesale Price Litigation, M.D.L. No. 1456, No. 01-12257 (D. Mass), was brought by consumers and insurance companies who said the drug manufacturers fraudulently inflated published average wholesale drug prices in order to reap greater profits than they were entitled to. Under the terms of the settlement, 82.5% of the settlement fund is earmarked for third-party payors' or insurance company claims and 17.5% for consumer claims. The companies that settled on March 7 include: Abbott Laboratories; Amgen Inc.; Hoechst Marion Roussel; Baxter Healthcare Corp.; Baxter International Inc.; Bayer Corp.; Dey Inc.; Fujisawa Healthcare Inc.; Fujisawa USA Inc.; Immunex Corp.; Pharmacia Corp.; Pharmacia & Upjohn; Sanofi-Aventis; Sicor Inc.; Gensia Inc.; Gensia
Sicor Pharmaceuticals Inc.; Watson Pharmaceuticals Inc.; and ZLB Behring.

FDA to Expand Reach into China

The FDA announced March 14 that it is planning to establish eight full-time permanent FDA staff positions in the People's Republic of China and will hire an additional staff of Chinese nationals to bolster their efforts to ensure the safety of Chinese drug product imports to the United States. There has been a spate of tainted products imported from China into the United States in the past few years, ranging from drugs and food to children's toys.

Of particular recent concern to the FDA has been the introduction of contaminants into a Chinese-made component of the blood-thinning agent heparin. That ingredient was imported into the United States, where pharmaceuticals manufacturer Baxter International Inc. assembled the final product for distribution. Because of the Chinese-manufactured tainted heparin ingredient, Baxter earlier this year had to recall all lots of its heparin sodium injection multi-dose, single-dose vials and HEP-LOCK heparin flush products.

Elidel Failure-to-Warn Cases Go Forward, with Some Pauses

Following the FDA's Jan. 19, 2006, warning that some users of eczema drug Elidel' reported developing skin cancer and lymphoma, suits against the manufacturer, Novartis Pharmaceuticals Corp., began to pile up. Sixteen cases are now pending in New Jersey federal court, all charging that Novartis knew of the risks as early as 2001, but concealed them from the public and the medical community. The plaintiffs, including some children, claim they developed various forms of cancer, including Hodgkin's disease, non-Hodgkin's lymphoma, skin cancer, leukemia and rhabdomyosarcoma, a cancer of the skeletal muscles.

The issue of federal preemption of state claims is holding up some of the cases in district courts at this point. The question is currently being considered by the Third U.S. Circuit Court of Appeals, which heard arguments last Dec. 10 in a pair of cases that could resolve the pre-emption issue. They are McNellis v. Pfizer Inc ., 06-5148, in which a federal judge in New Jersey held that FDA drug-labeling regulations do not conflict with state tort laws that impose liability for failure to warn of known product risks; and Colacicco v. Apotex, 06-3107, in which a Philadelphia federal court ruled that federal preemption applied to Pennsylvania's failure-to-warn laws. While the lower courts await an answer from the Third Circuit, some Elidel proceedings have come to a halt. Wrote U.S. District Judge Jerome Simandle in Linkenmeyer v. Novartis Pharma- ceuticals and Anderson v. Novartis Pharmaceuticals, 07-1657, in his order staying two such cases before him: 'With both those cases [McNellis and Colacicco] pending before the Court of Appeals, it is all but certain that a forthcoming decision by that court will be dispositive of some of the issues.'

Plaintiff Who Keeps Mum About Damage Amount Can't Avoid Fed Court

A plaintiff who wanted her products liability suit ' based on injuries she says were caused by a birth control device ' remanded to state court has lost her bid by failing to stipulate that she would not seek more than $75,000 in damages. The plaintiff, Carmita T. Purdiman, used the NuvaRing birth control device for just one month before she developed a pulmonary embolism, which can lead to blood clots. After she was seen in her hospital's emergency room, her condition required her to remain in the hospital for a week. Claiming she must now take blood thinners, submit to weekly testing and be closely monitored in the future for what she terms a permanent condition, the plaintiff sought medical expenses, future medical expenses, lost wages, and pain and suffering. The defendants, Organon Pharmaceuticals USA Inc. and Organon International Inc., removed the suit to federal court based on diversity of citizenship and an amount in controversy in excess of $75,000.

The plaintiff sought remand, saying the defendants had failed to prove by a preponderance of the evidence that the amount in controversy exceeds $75,000, although she refused to specify an amount of damages and would not sign an affidavit stating she would not seek damages in excess of $75,000. The court used what it termed its own 'common sense and experience' to find from the pleadings that the amount in controversy more likely than not would exceed $75,000, what with the prolonged hospital stay, lost wages, future medical monitoring, etc. Thus, it held that defendants had met their burden to prove by a preponderance of the evidence that federal jurisdiction was appropriate in the action. The case is Purdiman v. Organon Pharmaceuticals USA Inc., Slip Copy, 2008 WL 686996 (N.D.Ga., 3/12/08).