It’s no secret that pharmaceutical companies are among the more litigious businesses in America. Up until 2003, when Congress stepped in, the big drug makers had a good thing going: whenever the patent was about to expire on one of their blockbuster drugs, they would file a new patent for trivial modifications to the medicine, and thereafter would sue generic drug manufacturers claiming that the generic version of the old drug somehow infringed on the new patent.
Here’s the kicker: the big drug makers knew these patent infringement claims were frivolous, so they would enter into a “settlement” in which the big drug company — which nominally brought the case to recover monetary damages — would pay the generic company not to manufacture the generic drug anymore. Crazy, huh?
So crazy and so hopelessly anticompetitive that in 2003 Congress amended the Hatch-Waxman Act to force the major drug companies to report all of these “exclusive-payment” patent settlements to the Federal Trade Commission. The FTC still keeps an eye on them and keeps filing amicus briefs to make sure courts realize how damaging that practice is. As I’ve discussed before, some unions and health plans, stymied by the Illinois Brick decision precluding antitrust claims by indirect purchasers, have tried recovering the inflated health care expenses by filing unfair trade practices lawsuits.
The pharmaceutical companies are also not strangers to deceiving the federal government; over the past decade they’ve paid several billion dollars in qui tam cases, the result of brave whistleblowers exposing the fraud at great personal cost.
So pardon me if I don’t think that pharmaceutical companies deserve a special exception from the basic legal responsibilities we all have to one another just because they claim litigation is expensive or because they claim that always tell the FDA the truth. That sort of special treatment is what they’re trying to get with “tort reform” in the Pennsylvania legislature, and what they’re claiming they’re owed in the courts:
In questioning during oral argument Tuesday in Philadelphia, a state Supreme Court justice characterized the drugmaker Wyeth as asserting that there is enough protection for persons harmed by prescription drugs in federal regulation of the release of drugs onto the market, and limiting plaintiffs to lawsuits for drugmakers’ alleged failures to adequately warn of risks.
Plaintiffs are arguing in a case that could change the landscape of pharmaceutical products liability law in Pennsylvania that drugmakers can be sued for the negligent design defect of their drugs.
Questioning the plaintiffs’ lawyer, Justice Max Baer also said that Wyeth asserts that Pennsylvania would chill the manufacturing of prescription drugs if pharmaceutical companies can be sued for the negligent design defect of their drugs. He asked the lawyer to address why that may not be so.
The case, Lance v. Wyeth, arises from a primary pulmonary hypertension death allegedly caused by Redux, a hopelessly dangerous diet drug that causes a host of medical conditions which was yanked from the market for causing valvular heart disease. No one credibly disputes that the drug should never have been marketed or sold in the first place: it combined two drugs known to cause cardiovascular problems. Had Wyeth (now owned by Pfizer) properly tested it, they probably would never have sold it. Had they properly warned doctors and patients of the real risks, no doctor would have prescribed it and no patient would have taken it.
If dangerous drugs were automobiles with defective air bags (like Gaudio v. Ford Motor Co.), or rollover-prone all-terrain vehicles (like Smith v. Yamaha Motor Corp.) there wouldn’t be a question of the applicable law. Everybody — you, me, lemonade stands, multinational corporations, and everyone in between — has the same general legal duty to exercise reasonable care not to cause injuries to others. If we don’t exercise that reasonable care, we’re negligent, and we’re responsible to pay for the damage we cause.
That’s how the tort of negligence works. It’s quite simple.
In addition to their responsibility to pay for all negligently caused damages, everyone who sells products — again, from the lemonade stand to the multinational corporation — has “strict liability” for all damages caused by defective products. Consider that defective air bags case above:
[W]e will briefly review the history of products liability law and the crashworthiness doctrine in this Commonwealth. Our Supreme Court first adopted section 402A of the Restatement (Second) of Torts in Webb v. Zern, 422 Pa. 424, 220 A.2d 853 (1966). To state a section 402A products liability claim in Pennsylvania, the plaintiff must prove that the defendant sold a product “in a defective condition,” that the defect existed when the product left the defendant’s hands, and that the defect caused the plaintiff’s injuries. See, e.g., Hadar v. AVCO Corp., 886 A.2d 225, 228 (Pa.Super.2005). A product is “in a defective condition” when it lacks “any element necessary to make it safe for its intended use or possessing any element that renders it unsafe for the intended use.” Azzarello v. Black Bros. Co., Inc., 480 Pa. 547, 559, 391 A.2d 1020, 1027 (1978). Because the key inquiry in all products liability cases is whether or not there is a defect, it is the product, and not the defendant’s conduct, that is on trial. See, e.g., Hutchinson v. Penske Truck Leasing Co., 876 A.2d 978, 983 (Pa.Super.2005), affirmed, 592 Pa. 38, 922 A.2d 890 (2007).
But Section 402A of the Second Restatement of Torts has a pesky “comment k” for defective drug cases which says:
There are some products which, in the present state of human knowledge, are quite incapable of being made safe for their intended and ordinary use. These are especially common in the field of drugs. . . . Such a product, properly prepared, and accompanied by proper directions and warning, is not defective, nor is it unreasonably dangerous. The same is true of many other drugs, vaccines, and the like, many of which for this very reason cannot legally be sold except to physicians, or under the prescription of a physician. . . . The seller of such products, again with the qualification that they are properly prepared and marketed, and proper warning is given, where the situation calls for it, is not to be held to strict liability for unfortunate consequences attending their use, merely because he has undertaken to supply the public with an apparently useful and desirable product, attended with a known but apparently reasonable risk.
Defense lawyers contend that comment k promises pharmaceutical companies total and complete immunity from all potential theories of liability except for a narrow class of “failure to warn” claims. Wyeth argued that the sole question is “whether the risk information conveyed to prescribing physicians was sufficient to permit them to conduct an individualized risk-benefit analysis.”
The plaintiffs in Lance were smart to hire Howard Bashman, friend of the blog, for their appeal, and his excellent opening brief and reply are both online. So, too, is the joint American Association for Justice and Pennsylvania Association for Justice amicus brief.
The briefs quite adequately cover Pennsylvania law on the subject, all the Incollingo v. Ewing, 444 Pa. 263, 282 A.2d 206 (1971)(a Jim Beasley case), Baldino v. Castagna, 505 Pa. 239, 478 A.2d 807 (1984), and Hahn v. Richter, 543 Pa. 558, 673 A.2d 888 (1996) a drug liability law nerd could ask for.
Personally, I think two arguments should decide Lance v. Wyeth.
First, negligence and strict liability are two entirely separate claims. Whatever comment k has to say about strict liability, it has nothing to do with negligence. Strict liability focuses on the product — i.e., whether the product itself was defective or unreasonably dangerous — and the consumer’s expectations, while negligence focuses on the reasonableness of the defendant’s conduct in designing, testing, marketing, and selling the product.
It’s no stretch to say that applying Section 402A’s comment k is like comparing apples to oranges; you don’t mix and match analyses of separate legal claims that are proven with entirely different elements. That’s why even the two most defense-friendly jurisdictions — California and Utah, where the highest courts of those states have categorically rejected strict liability design defect claims involving prescription drugs — nonetheless recognize that negligent design defect claims against prescription drug manufacturers may still be pursued. See Artiglio v. Superior Court, 27 Cal. Rptr.2d 589, 591 (Cal. App. 1994) (“Liability for defective design could not be premised on strict liability, but would require proof of negligence”); Lake-Allen v. Johnson & Johnson L.P., 2009 WL 2252198, at *2-3 (D. Utah July 27, 2009) (refusing to dismiss negligent design defect claim, finding comment k “limited to strict liability”).
Second, California’s and Utah’s interpretation of comment k is wrong and is not sound policy. See Brown v. Superior Court, 751 P.2d 470, 477 (Cal. 1988)(“comment k would impose liability on a drug manufacturer only if it failed to warn of a defect of which it either knew or should have known.”); Grundberg v. Upjohn Co., 813 P.2d 89 (Utah 1991)(“We are persuaded that all prescription drugs should be classified as unavoidably dangerous in design because of their unique nature and value, the elaborate regulatory system overseen by the FDA, the difficulties of relying on individual lawsuits as a forum in which to review a prescription drug’s design, and the significant public policy considerations noted in Brown.”).
Brown‘s and Grundberg‘s rejection of all strict liability claims other than the failure to warn was wrong. The overriding purpose of comment k is to protect manufacturers from strict liability for “an apparently useful and desirable product, attended with a known but apparently reasonable risk” that was nonetheless “incapable of being made safe for their intended and ordinary use.” That is, a manufacturer of a useful and desirable product should not be liable for those known but apparently reasonable risks inherent to any version of the product.
Let’s consider an example. Ropinirole (Requip) is a dopamine agonist used in the treatment of the symptoms of Parkinson’s disease and Restless Legs Syndrome; it’s a useful and desirable product that includes the known risk of “intense urges to gamble, increased sexual urges, and other intense urges and the inability to control these urges.” Those risks are inherent to any effective dopamine agonist, because the medicine works by altering dopamine levels. Those risks are further rare and can generally be diagnosed and treated before causing serious injury. The product is useful and desirable, and the risks are both unavoidable and “apparently reasonable” in light of the benefits. Thus, the manufacturer will not be held strictly liable for patients who experience those “intense urges” unless the manufacturer failed to properly warn of them.
That’s it. That’s as far as the comment k analysis should go; there is no reason in logic or policy for extending the basic principle in comment k — that a manufacturer shouldn’t be held responsible for known and unavoidable risks that are reasonable in light of the product’s benefits — to eliminate each and every claim a consumer could possibly have against a drug company for selling a dangerous drug other than the failure to warn. Comment k doesn’t even imply such a policy, much less state it and argue in favor of it.
Go back to the facts of the Lance case. Redux was not a “useful and desirable product,” and its risks were neither “known” to physicians (much less patients) nor were they “reasonable.” Patients unwittingly took a drug that was far more dangerous than the condition it was meant to treat, a drug no physician would actually prescribe had Wyeth disclosed the risks it knew or should have known. Same goes for Topamax; no patient “knowingly” undertook the “reasonable” risk of a birth defect in their child just to cure a migraine. Same goes for Actos; no patient sat down with their physician and conscientiously decided it was reasonable to take the diabetes drug with a 40% higher rate of bladder cancer than the alternatives.
These drugs were defective. They weren’t designed properly. They weren’t tested properly. It isn’t just that the company didn’t stamp a hypertension or birth defective or cancer warning on the label — the company shouldn’t have released the product in the first place. The company should thus be responsible for the harm caused by its defective product. A car company can’t just slap a warning on an exploding car and then wash its hands of any accountability. A lemonade stand can’t sell poison with a warning sticker on it. Every other manufacturer in America is responsible for its defective products — why not apply the same laws to pharmaceutical companies that spend twice as much on marketing as they do on research and development?
Take it even from Justice Scalia writing in Bruesewitz v. Wyeth:
Design-defect torts, broadly speaking, have two beneficial effects: (1) prompting the development of improved designs, and (2) providing compensation for inflicted injuries.
If the Pennsylvania Supreme Court goes with Wyeth in the Lance case, they will eliminate both the incentive for pharmaceutical companies to appropriately design and test new drugs, and the compensation available for the damage left behind when a company just shoves a defective product out the door.
If the question is if it would “chill the manufacturing of prescription drugs if pharmaceutical companies can be sued for the negligent design defect of their drugs,” then the answer should be: why should we make the public, rather than the company, pay for the cost of negligently designed drugs?