Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Drug & Device News

By ljnstaff
August 01, 2017

Parent J&J Is Off the Hook; Not So Its Subsidiary

U.S. District Judge Michael Shipp has granted Johnson & Johnson's (J&J's) motion for summary judgment in a suit alleging that its subsidiary, Janssen Products, promoted off-label use of its HIV/AIDS drugs Prezista and Intelence. Citing to precedent set by the U.S. Court of Appeals for the Third Circuit in In re Burlington Coat Factory Securities Litigation, Judge Shipp concluded that “mere ownership” of a subsidiary did not subject the parent company to liability. However, the qui-tam claims brought by relators within Janssen's sales force got the green light to go forward.

The claims allege that Janssen violated the federal False Claims Act (FCA), the federal Anti-Kickback Statute, and a number of state anti-fraud laws by inducing physicians to prescribe the drugs for off-label uses in order to reap payments from Medicaid and Medicare. The scheme, the plaintiffs say, involved the company conducting dinners for physicians at which speeches were made, while promoters were planted throughout the audience to ask specific questions with the aim of convincing attendees to prescribe the drugs to their patients. In addition, the claims allege that the manufacturer said Prezista does not negatively affect cholesterol or triglyceride levels, when in fact it does, and can therefore increase a consumer's cardiovascular disease risk.

The court dismissed some state law claims but concluded that the complaint against Janssen “adequately pled a nationwide scheme of misbranding and the utilization of kickbacks to survive a motion to dismiss.”

Pharmaceuticals Benefits Manager Files Suit over Drug's Cost

The largest pharmaceuticals benefits manager in the United States, Express Scripts, has brought suit against Kaléo Pharma, the maker of the drug Evzio, which is used to counteract the effects of opioid overdose. According to a New York Times report, the suit claims that Kaléo Pharma has been unfairly raising the price for the medication, starting below $1,000 per two-pen pack in 2016, and rising to nearly $4,700 for the same pack by April 2017. Kaléo Pharma says the pricing reflects the fact that the company offers the medication free or at a reduced price to less affluent patients and to those without medical insurance.

Experts' Testimony Passes Reliability Test

The U.S. Court of Appeals for the Ninth Circuit has reversed the dismissal of a suit against a pharmaceuticals manufacturer after finding that the district court erred in excluding the plaintiffs' expert medical testimony as unreliable. Wendell v. Glaxosmithkline LLC, 2017 U.S. App. LEXIS 9787 (9th Cir. 6/2/17).

The case involves a boy with irritable bowel syndrome (IBD), Maxx Wendell, who at the age of 12 was first prescribed mercaptopurine (6-MP), an immunosuppressant drug manufactured at that time by GlaxoSmithKline (GSK). The drug, one of a class known as thiopurines, was marketed under the name Purinethol. It was not FDA-approved for treatment of IBD, but was commonly prescribed for such patients. Maxx took the drug for eight years.

During this same time period, Maxx's doctor prescribed for him a second drug, the tumor necrosis factor alfa antagonist (anti-TNF) drug infliximab, marketed as Remicade. Anti-TNF drugs are approved to treat a number of autoimmune disorders, such as Crohn's disease and rheumatoid arthritis. When Maxx's IBD went into remission in 2006, his doctor took him off of Remicade. Two months later, the FDA approved a new label for Remicade that included a warning that development of HSTCL — a rare form of non-Hodgkin's lymphoma — had been observed in young male patients taking both Remicade and a thiopurine, such as 6-MP. When the label change was made, Remicade's manufacturer, Centicor, sent “Dear Health Care Provider” letters to prescribers to alert them to the new warning.

When Maxx's IBS symptoms later returned, his doctor put him on another anti-TNF drug, Humira, which at that time did not come with a warning about development of HSTCL. At age 20, Maxx was diagnosed with HSTCL. He died within six months of that diagnosis.

Maxx's parents brought suit against several drug manufacturers, settling with most of them prior to trial. The U.S. District Court for the Northern District of California then dismissed the case on motion for summary judgment after concluding, inter alia, that the plaintiffs' experts' causation testimony was not reliable under the Daubert standard and was therefore inadmissible under Federal Rule of Evidence 702. The bases for this ruling were that the plaintiffs' two medical experts developed their opinions specifically for litigation, and they had never conducted independent research on the relationship between 6-MP and anti-TNF drugs and the development of HSTCL. Both experts also admitted that their conclusions about the relationship between 6-MP and anti-TNF drugs causing HSTCL would not satisfy the standards required for publication in peer-reviewed medical journals.

The district court concluded that the experts' lack of independent research combined with their reluctance to publish, “casts doubt [on] the reliability of their methodologies under Rule 702.” Added to this, the district court observed that more than 70% of HSTCL cases are idiopathic, so the lack of animal of epidemiological studies showing a causal link between HSTCL and the drug combination of 6-MP and anti TNF drugs made it, in the district court's opinion, impossible for the proffered experts to “reasonably eliminate other potential causes of Maxx's HSTCL.” After granting the defense's motion for summary judgment, the district court denied the plaintiffs' motion for reconsideration. The plaintiffs appealed to the Ninth Circuit.

While noting that the case had presented “a close question,” the appellate court nevertheless reversed, finding that the district court incorrectly put too much weight on the facts that the experts formed their opinions when researching for this litigation, and had not been published on the subject at hand. “While independent research into the topic at issue is helpful to establish reliability, its absence does not mean the experts' methods were unreliable,” said the court. Instead, an expert is permitted to use other means of showing that his conclusions are based on sound scientific grounds. The proffered experts had done that.

The court was impressed with the lengthy and distinguished medical careers of the plaintiffs' two proffered experts, to include their close observations of multiple patients with non-Hodgkin's lymphoma, as well as their teaching and medical research credentials. One of the doctors stated that “6-MP is a well-known mutagen and carcinogen and puts every person who takes it at risk. And given the frequency of hepatosplenic lymphoma in [the] general population as … [compared with] those who take 6-MP, it makes it plausible or biologically plausible that that's [an] etiologic factor. You construct your differential diagnosis … [of] what might have caused lymphoma. You come up with the strongest probability that [the] patient was taking [a] carcinogen and developed lymphoma and you start thinking again what can cause his lymphoma, you can't identify anything else in the patient's history or his medical records.” He opined that there was a one in six million chance that Maxx would had developed HSTCL without exposure to the drugs he ingested to treat IBS, and therefore it was likely his exposure to these substances caused the lymphoma. The other doctor used similar logic to conclude that Maxx likely contracted lymphoma through exposure to the IBS-treatment drugs.

The Ninth Circuit also chided the district court for conflating the standards for publication in a peer-reviewed journal with the standards for admitting expert testimony in a courtroom. The district court had found a lack of rigorous scientific analysis from the fact that the experts admitted they would not be willing to publish their opinions about the correlation between taking the drugs that Maxx took and contracting HSTCL. The reasons they gave for their reticence were that they had no new data to contribute to the scientific dialogue, and any meta-analysis or review of the literature could only be published upon invitation.

The appellate court observed that “[t]he district court viewed these statements regarding the experts' willingness to publish as evidence that their methods were not up to snuff. But this analysis misses that while an expert must 'employ[] in the courtroom the same level of intellectual rigor that characterizes the practice of an expert in the relevant field,' Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 152 (1999), the standards for courtroom testimony do not necessarily parallel those of the professional publications.” Opinions need not be published or publishable; the fact that they are not can go to the weight a jury assigns them, the court concluded.

Because “the district court looked too narrowly at each individual consideration, without taking into account the broader picture of the experts' overall methodology,” and it “improperly ignored the experts' experience, reliance on a variety of literature and studies, and review of Maxx's medical records and history, as well as the fundamental importance of differential diagnosis by experienced doctors treating troubled patients,” the Ninth Circuit found that the experts' testimony should have been admitted. For this and other reasons, the appeals court reversed and remanded the case to the district court.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
How Secure Is the AI System Your Law Firm Is Using? Image

In a profession where confidentiality is paramount, failing to address AI security concerns could have disastrous consequences. It is vital that law firms and those in related industries ask the right questions about AI security to protect their clients and their reputation.

COVID-19 and Lease Negotiations: Early Termination Provisions Image

During the COVID-19 pandemic, some tenants were able to negotiate termination agreements with their landlords. But even though a landlord may agree to terminate a lease to regain control of a defaulting tenant's space without costly and lengthy litigation, typically a defaulting tenant that otherwise has no contractual right to terminate its lease will be in a much weaker bargaining position with respect to the conditions for termination.

Pleading Importation: ITC Decisions Highlight Need for Adequate Evidentiary Support Image

The International Trade Commission is empowered to block the importation into the United States of products that infringe U.S. intellectual property rights, In the past, the ITC generally instituted investigations without questioning the importation allegations in the complaint, however in several recent cases, the ITC declined to institute an investigation as to certain proposed respondents due to inadequate pleading of importation.

The Power of Your Inner Circle: Turning Friends and Social Contacts Into Business Allies Image

Practical strategies to explore doing business with friends and social contacts in a way that respects relationships and maximizes opportunities.

Authentic Communications Today Increase Success for Value-Driven Clients Image

As the relationship between in-house and outside counsel continues to evolve, lawyers must continue to foster a client-first mindset, offer business-focused solutions, and embrace technology that helps deliver work faster and more efficiently.