Evelyn Pringle August 2007
The FDA's latest campaign to protect the profits of a drug company over the safety of Americans is unprecedented, and the organizers include a gang of current and former FDA officials largely credited with turning the nation's regulatory beagle into a lapdog for Big Pharma under the Bush Administration.
FDA spokesman Douglas Arbesfeld, apparently the industry's new inside guy, kicked off the campaign by sending an e-mail to journalists which was intended to discredit Dr Steven Nissen and the Cleveland Clinic. Dr Nissen's study appeared online on May 21, 2007, in the New England Journal of Medicine and warned that GlaxoSmithKline's diabetes drug Avandia increased the risk of heart attacks by 43% and death from cardiovascular events by possibly 64%.
The talking points for the media were obviously agreed upon ahead of time because the stories that appear on the internet refer to Dr Nissen with names like "St Steven", "Patron Saint of Drug Safety" and "Saint Steven the Pure."
In his email to journalists, Mr Arbesfeld pasted portions of an article which appeared on the Heartwire website, containing umpteen critical comments about Dr Nissen and the Avandia study, as well as comments made by an anonymous blogger on the internet which said that business at the Cleveland Clinic is run similar to a Mafia TV series. The full bog states:
"Wake up pharmaceutical companies, this is a call from Dr. Nissen, if you don't hire the Cleveland Clinic for your big trials then you face the firing squad from Nissen and Company."
"The Cleveland Clinic was one of the most respected names in medicine, now they are positioning themselves as candidates to take over for a new series on HBO to replace the Soprano's — the Clinico's 'next week who should we wack ......' — Bata bing bata boon. Comment by Brian A - May 22, 2007."
However, it could just as easily be inferred that Mr Arbesfeld authored the slanderous blog and supplied it to Heartwire with the intention of quoting it later from a “reputable” web site. For its part, Heartwire has since removed what it says are "unsubstantiated remarks about Dr Nissen and the Cleveland Clinic", and states: "In retrospect we regret that we published those sentences, as they do not meet the highest standards of journalistic or scientific integrity or credibility."
The smear campaign has federal lawmakers up in arms. At a June 6, 2007, hearing before the House Oversight and Government Reform Committee, in response to questions about Mr Arbesfeld sending the e-mail under his official title of FDA spokesman, FDA Commissioner Andrew von Eschenbach told the lawmakers, "It was an inappropriate and unfortunate act on the part of an individual which has been addressed through disciplinary procedures."
Dr Nissen is none to happy about the stunt either. "I'm a pretty tough guy," he told ABC News on May 30, 2007, "but I'll tell you, having this kind of an e-mail that questions my motives, broadcast to the major journalists with whom I work and have established a reputation, is -- it's an outrage."
As for his part, Mr Arbesfeld told the Boston Globe that the email reflected his own personal views and not the FDA's. Any assertion that the email reflected his own personal views is not quite credible considering that his previous employment was always promoting the views of the industry.
A few articles in the media mentioned that Mr Arbesfeld worked for Johnson & Johnson, but his employment with public relations firm Manning Selvage & Lee was not noted. On December 16, 1999, the Healthcare Marketing & Communications Council reported that Mr Arbesfeld had joined Manning as Senior Vice President in New York.
On January 5, 2001, the firm issued a press release to announce the promotion of Mr Arbesfeld and others and referred to Manning as "one of the largest healthcare practices worldwide and has a broad array of clients including Allergan, Amgen, Eli Lilly and Company, Genentech, Hoffmann La-Roche, Kaiser Permanente, Novartis, Pharmacia and Procter & Gamble."
In reading the press release, Mr Arbesfeld's email expertise is apparently a bi-product of his work for Manning. "In this role," it said, "Arbesfeld will help healthcare clients maximize internet-relations in the marketing and communications mix, and will expand the Practice's strategic e-product offerings."
On August 5, 2002, he identified himself in a Reuters article as representing none other than Glaxo, along with six other drug giants including Bristol-Myers, Aventis, J&J, AstraZeneca, Abbott Labs and Novartis, in a campaign to promote the "Together Rx" prescription drug card program for senior citizens. In 2005, the Reporters Handbook listed him as the contact person for J&J subsidiaries, Janssen Pharmaceutica, Ortho-McNeil Pharmaceutical and Ortho Biotech Products.
Less than a week after Mr Arbesfeld's hatchet job on Dr Nissen, ex-FDA Deputy Commissioner Dr Scott Gottlieb planted an editorial in the May 29, 2007, Wall Street Journal entitled, "Journalist Malpractice," accusing the New England Medical Journal of intentionally publishing the Nissen study to make the FDA look impotent. "The publication was timed," he wrote, "to get ahead of the Food and Drug Administration's more careful evaluation of the same issues."
"The journal seemed bent on beating the FDA to the punch," Dr Gottlieb claimed.
"The goal?" he said, "Painting the FDA as impotent, in order to argue for legislation winding through Congress that would increase regulatory hurdles for drug approvals."
The only problem with the Nissen-NEJM conspiracy theory is that the issue under investigation in Congress right now is why the FDA did not warn the public about Avandia heart risks six months before the Nissen study was ever published.
In the end, when it comes to "Journalistic Malpractice," the larger question would seem to be how was it that so many industry shills were able to get the major media outlets and medical journals to immediately publish commentaries and editorials attacking the NEJM and the Nissen research with headlines splashing all over the internet.
In his editorial, Dr Gottlieb notes that there are "questions" whether Avandia is associated with heart risks, but says they are "so far unsupported by more rigorous, randomized studies and extensive review by the FDA and other authorities around the world."
"When it comes to the issue du jour, drug safety," he wrote, "no description of medical research in a medical journal comes close to the detail level or scrutiny imposed by the FDA on study results before approval."
There is no doubt much truth to this assertion, but the problem is that the industry insiders running the FDA refuse to act on the advice of the agency's top scientists. In a July 26, 2007, speech on the Senate floor, Senator Charles Grassley (R-Iowa), of the Senate Finance Committee, said that, in the case of Avandia, "Not only did the FDA disregard the concerns and recommendations from the office responsible for post-marketing surveillance, but I have found that it also attempted to suppress scientific dissent."
In the past two months, he told his fellow senators, "I've had to write to the FDA regarding the suppression of dissent from not one but two FDA officials involved in the review of Avandia."
The Heartwire website conveniently echoed Dr Gottlieb's sentiments by featuring portions of a May 23, 2007, unsigned editorial from the medical journal The Lancet, which claimed that the verdict on Avandia should await the results of a Glaxo sponsored trial called RECORD, not due out until 2009.
"Taken together," the editorial said of Dr Nissen's findings, "these results, although based on very small numbers of events, certainly raise a signal of concern and indicate the need for more reliable information about rosiglitazone's safety."
"But the FDA, physicians, and patients can reasonably await the results of RECORD, a phase 3 trial designed specifically to study cardiovascular outcomes," it said.
"Until the results of RECORD are in," the Lancet noted, "it would be premature to overinterpret a meta-analysis that the authors and NEJM editorialists all acknowledge contains important weaknesses."
The problem with waiting two years for the results of the RECORD trial is that FDA scientist Dr David Graham reviewed the results of this study thus far and told an FDA advisory panel that the study design is so flawed that the results should not be considered in any risk benefit analysis of Avandia now, or in 2009, in a July 26, 2007 report.
In fact, Dr Graham says the RECORD study is so useless that it's probably unethical to allow it to continue because no possible benefit can be achieved by allowing it to go on and that Avandia should be pulled off the market now because thousands of patients are being injured each month by using the drug.
At the end of his editorial, Dr Gottlieb lists himself as a physician and a resident fellow at the American Enterprise Institute who was Deputy Commissioner of the FDA from 2005 to 2007. However, back on August 24, 2005, the Seattle Times provided a much better picture of his background and highlighted the oddity of the FDA hiring him in the first place in light of his solid alliance with the industry. "Only a month ago," the article states, "Dr Scott Gottlieb was a Wall Street insider, promoting hot biotech stocks to investors."
"Now Gottlieb holds the No. 2 job,"” the Times notes, "at the federal agency that approves new drugs, oversees their safety and affects the fortunes of companies he once touted."
"Now, as one of three deputy commissioners," the article said, "Gottlieb will help oversee such major policies as the FDA's fast-track approval process for drug and biotech products, a priority for many Wall Street funds and the pharmaceutical industry."
The Times also noted that a half-dozen current and former FDA officials said they did not know of anyone else from Wall Street ever moving directly into such a high-level job at the agency.
A couple months later, the November 12, 2005, Boston Globe reported that Dr Gottlieb could not participate in formulating the nation's defense plan against the avian flu due to conflicts of interest. He "was recused from key parts of the planning effort because his past consulting work for Manning Selvage & Lee involved companies whose products would be used to combat a flu pandemic," it said.
The article pointed out that Dr Gottlieb's former clients included Roche, the manufacturer of Tamiflu, and Sanofi-Aventis, the parent company of the nation's sole flu vaccine maker.
According to the Globe, Manning paid Gottlieb a $12,500 monthly retainer for nine months for projects that included eight companies, and he was also paid $9,000 for private consulting work for VanGen Inc, a firm that won a $878-million contract to supply the US government with 75 million doses of anthrax vaccine.
In communicating with the FDA, lawmakers have mentioned that they found it "troubling" that Mr Arbesfeld might be trying to settle old scores with Dr Nissen because they were on opposite sides regarding the approval of the heart failure drug Natrecor.
However, Dr Nissen and Dr Gottlieb's disputes go way back as well. In fact, on August 2, 2006, they participated in a debate on the topic: "Government Science Panels: Fair and Balanced?" sponsored by the Center for Science in the Public Interest, and reported on by Russell Mokhiber and Robert Weissman in Common Dreams.
Much to his credit, Dr Nissen openly communicated his objections to the industry's infiltration of the FDA. While sitting right next Dr Gottlieb, he candidly described the conflicts of interest which he stated were "evident at the highest levels of the FDA."
"For years," he said of FDA leadership, "we had an interim FDA Commissioner, Lester Crawford, who shortly after confirmation, abruptly resigns, apparently because he and his wife owned stock in regulated companies."
"Then the administration appointed Andrew von Eschenbach as interim commissioner creating another conflict," he said. "In his role as director of the National Cancer Institute, von Eschenbach must seek FDA approval for human testing or approval of new cancer drugs, an obvious conflict," he noted.
"But even worse," Dr Nissen stated, "the administration appointed Scott Gottlieb as deputy commissioner."
"He came to this job with no regulatory experience, directly from Wall Street, where he served as a biotech analyst and stock promoter," Dr Nissen told the audience.
Dr Gottlieb's response to Dr Nissen's comments was basically that he would not dignify the comments with a response.
Firms that Dr Gottlieb was involved with prior to his gig at the FDA, according to the Globe, also include the Inamed Corp, one of two companies that were seeking to return silicone gel implants to the market and on November 17, 2006, the FDA announced that it would lift restrictions on the sale of the implants.
When Dr Gottlieb left the FDA, he headed right back to greener pastures with the drug giant Novartis. The press release to announce his hiring read: "Bench International Places Eminent Regulatory Advisor Scott Gottlieb, M.D., as Senior Counsel to Novartis."
"Under an exclusive consulting agreement," the release stated, "Scott Gottlieb, M.D., will provide advisory services to Novartis on matters of global regulatory policy and strategy."
The FDA recruited two members of its alumni, Peter Pitts and Robert Goldberg, to take another swipe at Dr Nissen in a June 6, 2007, commentary in the Washington Times, using the same talking points as the anonymous blogger, by referring to Dr Nissen as a "self-appointed and media-anointed Patron Saint of Drug Safety" and "Saint Steven the Pure."
For much of the childish commentary, they poke fun at Dr Nissen because he acknowledged in the NEJM that he consults for many drug companies but said he "requires them to donate all honoraria or consulting fees directly to charity so that he receives neither income nor a tax deduction."
At the end of the commentary, Mr Pitts says he is a former FDA associate commissioner, and both men list their affiliation with the Center for Medicine in the Public Interest; but as usual, that listing really does not give credit where credit is due.
On its web site, the Center describes itself as "a non-partisan, non-profit educational charity," and Mr Pitts is indeed listed as President, but his bio also says he is the Senior Vice President for Global Health Affairs at none other than Manning, Selvege & Lee.
The Manning firm apparently fills two important roles. It's a breeding ground for industry moles preparing to enter "public service" and serves as an employment hub for industry shills once they finish their on average 2- to 3-year stint inside the Bush Administration.
In his CMPI bio, Mr Pitts describes his duties as the FDA's Associate Commissioner from 2002 to 2004 as serving as the agency's "Chief Messaging Officer."
On June 7, 2007, Mr Pitts had this to say in defense of fellow hit-man Mr Arbesfeld on the Pharmalot web site: "I know Doug Arbesfeld and he is a guy devoted to advancing the public health."
According to Mr Pitts, in sending the derogatory e-mail about Dr Nissen to journalists, Mr Arbesfeld was just standing up for the FDA and that people should know about the sacrifice he made by accepting a job in government.
"He is also a guy," Mr Pitts says, "who took a pretty significant pay cut to put in some time in public service."
Some would no doubt argue that it's difficult to imagine that Mr Arbesfeld will end up in the poor house as a result of serving as the top industry mole inside the FDA.
Mr Pitts' sidekick, Mr Goldberg, is indeed listed as the vice president of CMPI, but Mr Goldberg's bio also says he used to be Director of the Manhattan Institute's Center for Medical Progress and Chairman of its 21st Century FDA Task Force.
In fact, a review of the CMPI web site turned up a whole nest of ex-moles who served the industry in one capacity or another in the Bush Administration's FDA. For instance, Daniel Troy, the former FDA Chief Counsel, also known as the "Godfather of Preemption," sits on this "charity's" Advisory Board.
His bio points out that he "played a principal role in FDA’s generally successful assertion of preemption in selected product liability cases."
This "assertion of preemption" says that, as long as the FDA has approved a drug and its label, private citizens in state courts cannot sue the drug company for failing to warn about a product's serious health risks, even in cases where it can be shown that the company concealed studies that revealed the risk from the public and the FDA.
Now that he's switched back to private practice, Mr Troy's CMPI bio says he currently specializes in constitutional and appellate litigation, as well as strategic counseling with "particular focus" on what else - clients regulated by the FDA.
The Advisory Board also includes, Tomas Philipson, whose bio says he served as the Senior Economic Advisor to the commissioner of FDA during 2003 and 2004 and as the Senior Economic Advisor to the administrator of the Centers for Medicare and Medicaid Services in 2004 and 2005.
That would mean that Mr Philipson served Mark McClellan, and they are now apparently joined at the hip because, as part of a program called "Patient-Centric and Prospective Medicine," CMPI says it has created the Patient-Centric Health Forum and that Mr McClellan, "former Medicare administrator and FDA commissioner, will chair the group."
So, it would appear that anyone looking for the retirement home for industry hit men who served in the Bush Administration's FDA can find it right in the middle of cyberspace on the CMPI web site.
(This article is part of the Avandia Update series sponsored by the Baum Hedlund law firm)
Showing posts with label stroke. Show all posts
Showing posts with label stroke. Show all posts
Sunday, August 8, 2010
Merck has no Plan to pay Vioxx Victims
Evelyn Pringle April 30, 2007
In 2006, Merck spent $500 million, including $175 million in the fourth quarter, in legal defense costs worldwide related to Vioxx litigation, according to SEC filings.
In addition, after reviewing actual costs and estimating future costs, the company says it has recorded a charge of $75 million to increase the reserve for future defense costs related to Vioxx to $858 million as of December 31, 2006.
However, although the legal team obviously plans to get paid well, there is no indication that Merck plans to pay any money to people injured by Vioxx because, according to the filing, Merck has not established any reserves for potential liability related to Vioxx.
Judging by the win-lose scorecard for Vioxx, it appears that juries are ignoring Merck's culpability in placing a lethal drug on the market with full knowledge that people would be injured and killed and that 100s of thousands of Americans were in fact injured and killed.
People who may have forgotten how much damage was done while Merck was raking in billions of dollars off Vioxx should go back and read the transcript of a November 19, 2004 hearing before the Senate Finance Committee, where Dr David Graham, a career scientist at the FDA who has no dog in this hunt, stated, "Vioxx has been a disaster."
"This is unparalleled in the history of the United States," he testified.
To give a clearer picture of the Vioxx disaster, he described the harm in relationship to the number of Americans who took the drug and experienced heart attacks and strokes. Based on an estimated range of 88,000 to 139,000 people, Dr Graham said, "Of these, 30 to 40 percent probably died."
He also offered a hypothetical scenario to help members of the committee recognize the magnitude of injuries and deaths caused by Vioxx, stating:
"Now, imagine that we were talking about jetliners. If there were an average of 150 to 200 people on an aircraft, this range of 88,000 to 139,000 would be the rough equivalent of 500 to 900 aircraft dropping from the sky. This translates to two to four aircraft every week -- week in, week out -- for the past five years."
Dr Graham testified that research indicated that Vioxx caused up to 160,000 heart attacks and strokes and was responsible for an additional 27,785 deaths from heart ailments from 1999 to 2003.
Years later, nothing has changed as far as Merck getting honest about the known dangers associated with Vioxx. A study in the September 2006 Journal of American Medical Association found that heart problems could develop in Vioxx users much sooner than the 18 months that Merck claimed and, in fact, could develop in one month.
Still another study in the same JAMA issue found Vioxx to be associated with an increased risk in erratic heartbeats, or arrhythmia, and renal events including swelling of the hands and feet, high blood pressure and kidney dysfunction.
According to the company's SEC filings, as of March 31, 2007, Merck had been served, or was aware that it had been named as a defendant, in approximately 27,250 lawsuits, which include about 45,700 plaintiff groups alleging personal injuries and approximately 266 putative class actions alleging personal injuries and/or economic loss.
Of these cases, approximately 8,400, representing about 23,450 plaintiff groups, are slated to be in the federal MDL and approximately 16,550 lawsuits representing about 16,550 plaintiff groups in a coordinated proceeding in New Jersey Superior Court.
In addition, the filing notes, approximately 13,700 claimants had entered into Tolling Agreements with Merck, which halt the running of statutes of limitations for claimants who seek to toll claims alleging injuries resulting from a thrombotic cardiovascular event that results in a myocardial infarction or ischemic stroke.
The filing also reports that individual and putative class actions have been filed in state and federal courts alleging personal injury and/or economic loss. A number of these actions, it says, are coordinated in a separate proceeding in an MDL in the US District Court for the Eastern District of Louisiana, and in coordinated proceedings in state courts in New Jersey, California and Texas; and in the counties of Philadelphia, Pennsylvania, Washoe County, Nevada and Clark County, Nevada.
Legal experts agree that the greatest threat to Merck comes from class-action lawsuits seeking recovery under consumer fraud statutes with claims that Merck failed to disclose damaging information to the public and, as a result, received a higher price for Vioxx than it would have if the information had been disclosed.
Legal experts say the most worrisome is a class-action filed in October 2003, now pending before the New Jersey Supreme Court. In the case of International Union of Operating Engineers Local 68 Welfare Fund vs Merck, New Jersey State Superior Court Judge Carol Higbee held that New Jersey's consumer fraud statute applies to all Vioxx sales in the US and granted class-action status to third-party payors nationwide in July 2005.
Most purchases for Vioxx were made by health plans run by insurance companies and health maintenance organizations, and the Union case could include millions of Vioxx users. Considering that an estimated 20 million consumers used Vioxx in the US since it came on the market in 1999, legal experts says, Merck could get hit with a judgment worth billions of dollars if it loses this one case.
The plans say they lost significant amounts of money after being persuaded by Merck's marketing efforts to add Vioxx to their formularies, or the lists of drugs for which they agree to reimburse members. The Union alleges that Merck's marketing and advertising of the drug was fraudulent and misrepresented the safety and efficacy of the drug.
Third-party payors in this case can recover the actual payments made for Vioxx, and they are entitled to treble damages, as well as attorney fees, under New Jersey consumer fraud laws. For instance, if there were 10 million Vioxx users who each bought $1,000 worth of the drug through the benefit plans at the going price at the time of $72 for a 30-day supply, a judgment could conceivably reach $10 billion, in addition to attorney fees.
Unlike personal injury cases, attorneys for the Union do not have to prove that anyone was injured, all they have to show is that the third-party payors were influenced to purchase Vioxx by Merck's deceptive marketing and promotion of the drug.
In allowing the lawsuit to go forward, Judge Higbee drew no distinction between a company defrauding a person or a third-party payor. "This Court," she wrote, "sees no reason why the duty to be honest about the safety and usefulness of a drug when marketing it as a product for sale should not extend to the third-party payors who actually pay for the purchase of drugs for members."
Merck appealed Judge Higbee's class certification, and in a unanimous decision in March 2006, the New Jersey appellate court affirmed the certification. From there, Merck appealed the appellate ruling to the New Jersey Supreme Court.
On March 19, 2007, a five-judge panel heard arguments, and the Union's lead attorney, Christopher Seeger, told the court that, because Merck concealed the risks of Vioxx from the health care plans, the drug was chosen over about 30 other cheaper products.
Mr Seeger said, New Jersey consumer fraud statutes should govern the case because all of the decisions about what information was disclosed about Vioxx and how the drug should be promoted and advertised to the public were made at Merck's New Jersey headquarters.
"It's perfect for a class action," Mr Seeger said. "If we really want to deter bad conduct, as is alleged in this case, the way to do it is to protect every purchaser of the product."
Legal analysts say a ruling by the high court is not expected for several months.
Another class-action got the go-ahead in Canada on November 9, 2006, when Quebec Superior Court Judge Andre Denis authorized a lawsuit by Quebec residents who suffered "damages caused by the use of the medication," between October 1999 and September 2004, according to the November 11, 2006 Moose Jaw Times Herald.
Dimitri Lascaris, an attorney for plaintiffs in Quebec and Ontario, said there have been more than 20 requests for class-action Vioxx lawsuits filed in Canada but this is the first case that has received clearance to proceed.
In 2006, Merck spent $500 million, including $175 million in the fourth quarter, in legal defense costs worldwide related to Vioxx litigation, according to SEC filings.
In addition, after reviewing actual costs and estimating future costs, the company says it has recorded a charge of $75 million to increase the reserve for future defense costs related to Vioxx to $858 million as of December 31, 2006.
However, although the legal team obviously plans to get paid well, there is no indication that Merck plans to pay any money to people injured by Vioxx because, according to the filing, Merck has not established any reserves for potential liability related to Vioxx.
Judging by the win-lose scorecard for Vioxx, it appears that juries are ignoring Merck's culpability in placing a lethal drug on the market with full knowledge that people would be injured and killed and that 100s of thousands of Americans were in fact injured and killed.
People who may have forgotten how much damage was done while Merck was raking in billions of dollars off Vioxx should go back and read the transcript of a November 19, 2004 hearing before the Senate Finance Committee, where Dr David Graham, a career scientist at the FDA who has no dog in this hunt, stated, "Vioxx has been a disaster."
"This is unparalleled in the history of the United States," he testified.
To give a clearer picture of the Vioxx disaster, he described the harm in relationship to the number of Americans who took the drug and experienced heart attacks and strokes. Based on an estimated range of 88,000 to 139,000 people, Dr Graham said, "Of these, 30 to 40 percent probably died."
He also offered a hypothetical scenario to help members of the committee recognize the magnitude of injuries and deaths caused by Vioxx, stating:
"Now, imagine that we were talking about jetliners. If there were an average of 150 to 200 people on an aircraft, this range of 88,000 to 139,000 would be the rough equivalent of 500 to 900 aircraft dropping from the sky. This translates to two to four aircraft every week -- week in, week out -- for the past five years."
Dr Graham testified that research indicated that Vioxx caused up to 160,000 heart attacks and strokes and was responsible for an additional 27,785 deaths from heart ailments from 1999 to 2003.
Years later, nothing has changed as far as Merck getting honest about the known dangers associated with Vioxx. A study in the September 2006 Journal of American Medical Association found that heart problems could develop in Vioxx users much sooner than the 18 months that Merck claimed and, in fact, could develop in one month.
Still another study in the same JAMA issue found Vioxx to be associated with an increased risk in erratic heartbeats, or arrhythmia, and renal events including swelling of the hands and feet, high blood pressure and kidney dysfunction.
According to the company's SEC filings, as of March 31, 2007, Merck had been served, or was aware that it had been named as a defendant, in approximately 27,250 lawsuits, which include about 45,700 plaintiff groups alleging personal injuries and approximately 266 putative class actions alleging personal injuries and/or economic loss.
Of these cases, approximately 8,400, representing about 23,450 plaintiff groups, are slated to be in the federal MDL and approximately 16,550 lawsuits representing about 16,550 plaintiff groups in a coordinated proceeding in New Jersey Superior Court.
In addition, the filing notes, approximately 13,700 claimants had entered into Tolling Agreements with Merck, which halt the running of statutes of limitations for claimants who seek to toll claims alleging injuries resulting from a thrombotic cardiovascular event that results in a myocardial infarction or ischemic stroke.
The filing also reports that individual and putative class actions have been filed in state and federal courts alleging personal injury and/or economic loss. A number of these actions, it says, are coordinated in a separate proceeding in an MDL in the US District Court for the Eastern District of Louisiana, and in coordinated proceedings in state courts in New Jersey, California and Texas; and in the counties of Philadelphia, Pennsylvania, Washoe County, Nevada and Clark County, Nevada.
Legal experts agree that the greatest threat to Merck comes from class-action lawsuits seeking recovery under consumer fraud statutes with claims that Merck failed to disclose damaging information to the public and, as a result, received a higher price for Vioxx than it would have if the information had been disclosed.
Legal experts say the most worrisome is a class-action filed in October 2003, now pending before the New Jersey Supreme Court. In the case of International Union of Operating Engineers Local 68 Welfare Fund vs Merck, New Jersey State Superior Court Judge Carol Higbee held that New Jersey's consumer fraud statute applies to all Vioxx sales in the US and granted class-action status to third-party payors nationwide in July 2005.
Most purchases for Vioxx were made by health plans run by insurance companies and health maintenance organizations, and the Union case could include millions of Vioxx users. Considering that an estimated 20 million consumers used Vioxx in the US since it came on the market in 1999, legal experts says, Merck could get hit with a judgment worth billions of dollars if it loses this one case.
The plans say they lost significant amounts of money after being persuaded by Merck's marketing efforts to add Vioxx to their formularies, or the lists of drugs for which they agree to reimburse members. The Union alleges that Merck's marketing and advertising of the drug was fraudulent and misrepresented the safety and efficacy of the drug.
Third-party payors in this case can recover the actual payments made for Vioxx, and they are entitled to treble damages, as well as attorney fees, under New Jersey consumer fraud laws. For instance, if there were 10 million Vioxx users who each bought $1,000 worth of the drug through the benefit plans at the going price at the time of $72 for a 30-day supply, a judgment could conceivably reach $10 billion, in addition to attorney fees.
Unlike personal injury cases, attorneys for the Union do not have to prove that anyone was injured, all they have to show is that the third-party payors were influenced to purchase Vioxx by Merck's deceptive marketing and promotion of the drug.
In allowing the lawsuit to go forward, Judge Higbee drew no distinction between a company defrauding a person or a third-party payor. "This Court," she wrote, "sees no reason why the duty to be honest about the safety and usefulness of a drug when marketing it as a product for sale should not extend to the third-party payors who actually pay for the purchase of drugs for members."
Merck appealed Judge Higbee's class certification, and in a unanimous decision in March 2006, the New Jersey appellate court affirmed the certification. From there, Merck appealed the appellate ruling to the New Jersey Supreme Court.
On March 19, 2007, a five-judge panel heard arguments, and the Union's lead attorney, Christopher Seeger, told the court that, because Merck concealed the risks of Vioxx from the health care plans, the drug was chosen over about 30 other cheaper products.
Mr Seeger said, New Jersey consumer fraud statutes should govern the case because all of the decisions about what information was disclosed about Vioxx and how the drug should be promoted and advertised to the public were made at Merck's New Jersey headquarters.
"It's perfect for a class action," Mr Seeger said. "If we really want to deter bad conduct, as is alleged in this case, the way to do it is to protect every purchaser of the product."
Legal analysts say a ruling by the high court is not expected for several months.
Another class-action got the go-ahead in Canada on November 9, 2006, when Quebec Superior Court Judge Andre Denis authorized a lawsuit by Quebec residents who suffered "damages caused by the use of the medication," between October 1999 and September 2004, according to the November 11, 2006 Moose Jaw Times Herald.
Dimitri Lascaris, an attorney for plaintiffs in Quebec and Ontario, said there have been more than 20 requests for class-action Vioxx lawsuits filed in Canada but this is the first case that has received clearance to proceed.
Lawmakers go after Amgen and J&J Over Off-Label Sales of Anemia Drugs
Evelyn Pringle April 22, 2007
To increase profits, drugs used to treat anemia in patients covered by Medicare are being given at higher doses and for conditions not approved by the FDA, due to reimbursement policies adopted by the Centers for Medicare and Medicaid Services under the leadership of top officials appointed by the Big Pharma-friendly Bush Administration.
At a December 6, 2006 hearing of the House Ways and Means Committee, then chairman Bill Thomas (R-CA), told Leslie Norwalk, acting commissioner of the CMS, "we have a payment policy that perhaps is killing people; and we are using $2 billion, the highest price paid in a relatively narrow area for the use of the drug through the payment policy, that may in fact be doing that."
Studies have shown that the massive off-label marketing of these drugs has definitely resulted in many deaths, but the question that remains is how many.
The drugs at issue include Aranesp, the brand name for darbepoetin, and Epogen and Procrit, the brand names for epoetin. Amgen manufactures all three drugs, but Ortho Biotech Products, a Johnson & Johnson subsidiary markets Procrit.
They are top money-makers for both companies. In 2006, ESA's combined had sales of nearly $10 billion, and Aranesp and Epogen accounted for $6.63 billion, or 48% of Amgen's total $14.3 billion revenue in 2006.
The drugs belong to a class known as Erythropoiesis Stimulating Agents (ESAs), which are man-made versions of a hormone normally produced in the kidneys to stimulate bone marrow cells to produce hemoglobin which is the main component of red blood cells.
The severity of anemia is determined by a patient's hematocrit, the proportion of red blood cells in whole blood, which should remain at between 33% and 36%, according to the FDA. The labeling for ESAs specifies that patients should have a hemoglobin level no higher than 12 grams per deciliter of blood.
ESAs are approved only to treat anemia and reduce the need for blood transfusions in patients with chronic kidney failure undergoing dialysis, patients with cancer who are receiving chemotherapy, patients scheduled for major surgery, and HIV patients with anemia due to zidovudine therapy.
However, they are being administered off-label to kidney patients who are not receiving dialysis, cancer patients who are not undergoing chemotherapy and in doses that result in higher levels of hemoglobin than are approved by the FDA as safe and effective.
On March 9, 2007, the FDA announced that all ESAs must carry black box warnings on their labels about the increased risk for serious side effects, including death, and advised doctors that they should use the lowest dose necessary to avoid the need for blood transfusions caused by anemia.
Several recent reports have shown that dialysis centers are administering higher doses of ESAs which has resulted in an increased rate of stroke, heart attack and death in dialysis patients. The dosage received by the typical dialysis patient in the US has nearly tripled since the early 1990s, according to the November 16, 2006, New York Times.
A paper presented at the annual conference of the American Society of Nephrology[,] reported that 37% of patients at Davita clinics, the second largest provider of dialysis in the US, had hemoglobin levels higher than 14 grams at least one time in a 9-month period.
Dialysis patients in the US are dying at a higher rate due to this drugging-for-profit scheme. In Europe, where lower doses of ESAs are given, the Times reports that, about 15% of dialysis patients die each year compared to 22% in the US.
Dialysis centers are also boosting profits by administering the drugs intravenously instead of by injection. According to the Boston Globe on October 24, 2006, clinics would use 30% less ESAs, at a potential savings of $375 million each year, if ESAs were injected because the method require a lower dose and they stay in the system longer.
Critics blame the over-use on the financial incentives in Medicare reimbursement policies. Medicare covers medical care for patients with End Stage Renal Disease, and between 1998 and 2003, spending for ESRD patients increased nearly 50%. About $64,000 a year is spent for each dialysis patient, according to US Renal Data System.
Medicare guarantees dialysis centers a 6% profit for administering ESAs, and in April 2006, the CMS drew fire from Capitol Hill when it adopted a policy allowing payment for the administration of ESAs until hematocrits reached 39%.
The Ways and Means Committee chairman, Rep Thomas, sent a letter chastising Mark McClellan, the CMS Administer at the time, asking why CMS had not developed a policy to deal with the out-of-control dosing of patients at a higher levels. "I cannot understand why CMS would knowingly contradict FDA findings," he wrote.
The CMS did not respond to the letter, so in November 2006, incoming chairman of the Committee, Rep Pete Stark (D-CA), and Rep Thomas sent a another letter to acting CMS Administrator Leslie Norwalk, describing the CMS policy as "a reimbursement incentive for providers to continue to increase doses" past the approved level.
Ms Norwalk did not respond to that letter either, but on December 6, 2006, Ms Norwalk and specific experts were called to testify at a Committee hearing due to "growing concern about unsafe and questionable treatment for Medicare's coverage for kidney failure, also known as End Stage Renal Disease," Rep Thomas said.
Through the current rules which endorse expanding reimbursement to allow hematocrit to be targeted to any level, Thomas said, CMS has implemented a policy harmful to its beneficiaries that will cost hundreds of millions of dollars in additional expenditures.
During the questioning of Ms Norwalk, it was revealed that the Monitoring Policy Group, created by the CMS, approved the higher hematocrit guidelines, and two-thirds of the members had financial ties to either Amgen, Johnson & Johnson or the dialysis clinics that profit by selling more of the drugs.
"Now what troubles me is that of the 24 members," Rep Stark told Ms Norwalk, "18 of them disclosed financial associations with Amgen or Johnson & Johnson."
It was also noted that the National Kidney Foundation guidelines had raised the hemoglobin limit to 13. However, a clue as to how that came about surfaced a few months later on March 21, 2007, when the New York Times reported that the president of the Foundation, Dr Allan Collins, was also the director of the Minneapolis-based Medical Research Foundation and in 2004, the year he was made president, Amgen underwrote more than $1.9 million worth of research and education programs led by Dr Collins, and paid him at least $25,800 in mostly consulting and speaking fees in 2005.
Dr Laura Pizzi, a professor at Jefferson Medical College, testified as lead author on a study in the November 2006, Dialysis and Transplantation journal, conducted to determine to what extent health care providers were adhering to clinical guidelines for patients receiving dialysis.
She said the study found significant overuse of the drugs, and although the researchers were not surprised to see that providers were not strictly adhering to the guidelines, they were surprised by the extent to which ESA use deviated from the recommendations.
When converting the increased use to dollar amounts based on Medicare reimbursement rates in 2005, Dr Pizzi said the population with a red blood cell count above industry guidelines had higher drug costs of $3,100 per patient each year.
"We estimate that CMS," she told the panel, "could have reduced expenditures for these drugs by 36 percent if dialysis facilities adhered to the guidelines."
If CMS spends $2 billion a year, she said, "it is reasonable to say that several hundred million dollars could have been saved if the providers followed the guidelines."
Dr Noshi Ishak, a kidney specialist who owns a dialysis clinic in Laconia, NH addressed the huge profits of administering ESA's intravenously instead of by injections.
He said he switched to administering the drugs by injection in 1998 and usage dropped by more than 20%, or equivalent "to $3,120 savings per patient per year for Medicare."
The FDA's Oncology Drugs Advisory Panel is scheduled to meet on May 10, 2007, to review the safety and effectiveness of ESAs, and lawmakers have ordered Amgen and J&J to cease all direct-to-consumer advertising and physician incentives until the FDA determines whether measures need to be taken to protect the public from these products.
To increase profits, drugs used to treat anemia in patients covered by Medicare are being given at higher doses and for conditions not approved by the FDA, due to reimbursement policies adopted by the Centers for Medicare and Medicaid Services under the leadership of top officials appointed by the Big Pharma-friendly Bush Administration.
At a December 6, 2006 hearing of the House Ways and Means Committee, then chairman Bill Thomas (R-CA), told Leslie Norwalk, acting commissioner of the CMS, "we have a payment policy that perhaps is killing people; and we are using $2 billion, the highest price paid in a relatively narrow area for the use of the drug through the payment policy, that may in fact be doing that."
Studies have shown that the massive off-label marketing of these drugs has definitely resulted in many deaths, but the question that remains is how many.
The drugs at issue include Aranesp, the brand name for darbepoetin, and Epogen and Procrit, the brand names for epoetin. Amgen manufactures all three drugs, but Ortho Biotech Products, a Johnson & Johnson subsidiary markets Procrit.
They are top money-makers for both companies. In 2006, ESA's combined had sales of nearly $10 billion, and Aranesp and Epogen accounted for $6.63 billion, or 48% of Amgen's total $14.3 billion revenue in 2006.
The drugs belong to a class known as Erythropoiesis Stimulating Agents (ESAs), which are man-made versions of a hormone normally produced in the kidneys to stimulate bone marrow cells to produce hemoglobin which is the main component of red blood cells.
The severity of anemia is determined by a patient's hematocrit, the proportion of red blood cells in whole blood, which should remain at between 33% and 36%, according to the FDA. The labeling for ESAs specifies that patients should have a hemoglobin level no higher than 12 grams per deciliter of blood.
ESAs are approved only to treat anemia and reduce the need for blood transfusions in patients with chronic kidney failure undergoing dialysis, patients with cancer who are receiving chemotherapy, patients scheduled for major surgery, and HIV patients with anemia due to zidovudine therapy.
However, they are being administered off-label to kidney patients who are not receiving dialysis, cancer patients who are not undergoing chemotherapy and in doses that result in higher levels of hemoglobin than are approved by the FDA as safe and effective.
On March 9, 2007, the FDA announced that all ESAs must carry black box warnings on their labels about the increased risk for serious side effects, including death, and advised doctors that they should use the lowest dose necessary to avoid the need for blood transfusions caused by anemia.
Several recent reports have shown that dialysis centers are administering higher doses of ESAs which has resulted in an increased rate of stroke, heart attack and death in dialysis patients. The dosage received by the typical dialysis patient in the US has nearly tripled since the early 1990s, according to the November 16, 2006, New York Times.
A paper presented at the annual conference of the American Society of Nephrology[,] reported that 37% of patients at Davita clinics, the second largest provider of dialysis in the US, had hemoglobin levels higher than 14 grams at least one time in a 9-month period.
Dialysis patients in the US are dying at a higher rate due to this drugging-for-profit scheme. In Europe, where lower doses of ESAs are given, the Times reports that, about 15% of dialysis patients die each year compared to 22% in the US.
Dialysis centers are also boosting profits by administering the drugs intravenously instead of by injection. According to the Boston Globe on October 24, 2006, clinics would use 30% less ESAs, at a potential savings of $375 million each year, if ESAs were injected because the method require a lower dose and they stay in the system longer.
Critics blame the over-use on the financial incentives in Medicare reimbursement policies. Medicare covers medical care for patients with End Stage Renal Disease, and between 1998 and 2003, spending for ESRD patients increased nearly 50%. About $64,000 a year is spent for each dialysis patient, according to US Renal Data System.
Medicare guarantees dialysis centers a 6% profit for administering ESAs, and in April 2006, the CMS drew fire from Capitol Hill when it adopted a policy allowing payment for the administration of ESAs until hematocrits reached 39%.
The Ways and Means Committee chairman, Rep Thomas, sent a letter chastising Mark McClellan, the CMS Administer at the time, asking why CMS had not developed a policy to deal with the out-of-control dosing of patients at a higher levels. "I cannot understand why CMS would knowingly contradict FDA findings," he wrote.
The CMS did not respond to the letter, so in November 2006, incoming chairman of the Committee, Rep Pete Stark (D-CA), and Rep Thomas sent a another letter to acting CMS Administrator Leslie Norwalk, describing the CMS policy as "a reimbursement incentive for providers to continue to increase doses" past the approved level.
Ms Norwalk did not respond to that letter either, but on December 6, 2006, Ms Norwalk and specific experts were called to testify at a Committee hearing due to "growing concern about unsafe and questionable treatment for Medicare's coverage for kidney failure, also known as End Stage Renal Disease," Rep Thomas said.
Through the current rules which endorse expanding reimbursement to allow hematocrit to be targeted to any level, Thomas said, CMS has implemented a policy harmful to its beneficiaries that will cost hundreds of millions of dollars in additional expenditures.
During the questioning of Ms Norwalk, it was revealed that the Monitoring Policy Group, created by the CMS, approved the higher hematocrit guidelines, and two-thirds of the members had financial ties to either Amgen, Johnson & Johnson or the dialysis clinics that profit by selling more of the drugs.
"Now what troubles me is that of the 24 members," Rep Stark told Ms Norwalk, "18 of them disclosed financial associations with Amgen or Johnson & Johnson."
It was also noted that the National Kidney Foundation guidelines had raised the hemoglobin limit to 13. However, a clue as to how that came about surfaced a few months later on March 21, 2007, when the New York Times reported that the president of the Foundation, Dr Allan Collins, was also the director of the Minneapolis-based Medical Research Foundation and in 2004, the year he was made president, Amgen underwrote more than $1.9 million worth of research and education programs led by Dr Collins, and paid him at least $25,800 in mostly consulting and speaking fees in 2005.
Dr Laura Pizzi, a professor at Jefferson Medical College, testified as lead author on a study in the November 2006, Dialysis and Transplantation journal, conducted to determine to what extent health care providers were adhering to clinical guidelines for patients receiving dialysis.
She said the study found significant overuse of the drugs, and although the researchers were not surprised to see that providers were not strictly adhering to the guidelines, they were surprised by the extent to which ESA use deviated from the recommendations.
When converting the increased use to dollar amounts based on Medicare reimbursement rates in 2005, Dr Pizzi said the population with a red blood cell count above industry guidelines had higher drug costs of $3,100 per patient each year.
"We estimate that CMS," she told the panel, "could have reduced expenditures for these drugs by 36 percent if dialysis facilities adhered to the guidelines."
If CMS spends $2 billion a year, she said, "it is reasonable to say that several hundred million dollars could have been saved if the providers followed the guidelines."
Dr Noshi Ishak, a kidney specialist who owns a dialysis clinic in Laconia, NH addressed the huge profits of administering ESA's intravenously instead of by injections.
He said he switched to administering the drugs by injection in 1998 and usage dropped by more than 20%, or equivalent "to $3,120 savings per patient per year for Medicare."
The FDA's Oncology Drugs Advisory Panel is scheduled to meet on May 10, 2007, to review the safety and effectiveness of ESAs, and lawmakers have ordered Amgen and J&J to cease all direct-to-consumer advertising and physician incentives until the FDA determines whether measures need to be taken to protect the public from these products.
Amgen and J&J Funnel Tax Dollars Through Kidney and Cancer Patients
Evelyn Pringle April 17, 2007
Medicare has provided coverage for all patients with End Stage Renal Disease since 1972, and according to the House Ways and Means Committee, the government pays for 93% of services provided to dialysis patients, at a cost of about $2 billion a year.
In 2005, the drugs darbepoetin and epoetin, commonly used by patients who must undergo dialysis, accounted for almost 20% of the $13 billion spent on the Medicare Part B drug plan, and total sales for these drugs worldwide topped $9 billion.
Amgen manufactures and markets darbepoetin as Aranesp, and epoetin is sold under the names Procrit and Epogen. But Procrit is distributed by Ortho Biotech Products, a Johnson & Johnson subsidiary. There are no generic versions of these medications.
The drugs are among the top sellers for both companies. Amgen's Epogen and Aranesp combined sales were $6.6 billion in 2006, nearly half of the company's total revenues. Johnson and Johnson's revenues were $3.2 billion in 2006, making it the company's second-biggest-selling drug, according to Forbes.com on March 21, 2007.
The drugs are man-made versions of erythropoietin, a hormone normally produced in the kidneys, and belong to a class of drugs known as Erythropoiesis Stimulating Agents. ESA's are used to treat anemia in raising hemoglobin levels by increasing the number of red blood cells in the body. Anemia's severity is monitored by a patient's hematocrit, the proportion of red blood cells in whole blood, which should stay between 33% and 36%.
According to the FDA, ESAs are approved to treat anemia in patients with chronic kidney failure, patients with cancer whose anemia is caused by chemotherapy, patients scheduled for major surgery to reduce potential blood transfusions, and for the treatment of anemia due to zidovudine therapy in HIV patients.
But Aranesp, Epogen, and Procrit are being administered "off label" for uses and in doses not approved by the FDA. For instance, an Amgen vice president recently estimated that about 10% to 12% of Aranesp sales are for the unapproved use of treating "anemia of cancer" in patients who are not undergoing chemotherapy.
A recent company study conducted to support FDA approval for using the drug to treat "anemia of cancer" in patients with cancer in remission who were not undergoing chemotherapy, revealed that Aranesp actually increased the risk of death in these patients.
The February 2, 2007, "Cancer Letter ," a newsletter for cancer professionals, warns, "If the findings of the recently reported study hold up, more than one in 10 Americans getting Aranesp without chemotherapy has no chance of benefiting from the agent and could be harmed or killed by it, experts say."
The report estimated that up to 12% of the use of ESAs in the US was for this condition.
After reviewing the results of this study and several others, on March 9, 2007, the FDA announced that black box warnings would be added to the labels for all ESAs and recommended using the lowest possible dose to raise the hemoglobin concentration to the lowest level.
The FDA-approved labeling for the drugs says patients should have a hemoglobin level of 10-12 grams per deciliter of blood, and patients are considered to need treatment if their levels fall below 10 grams.
During a press briefing, Dr Richard Pazdur, director of the FDA's Office of Oncology Drug Products at the Center for Drug Evaluation and Research, said the black box warning was being added based on the results of several recently reported clinical trials.
Dr Karen Weiss, deputy director of the Office of Oncology Drug Products, said the FDA became concerned after receiving the results from several trials evaluating the aggressive use of ESAs to raise hemoglobin levels higher than listed on their approved labels.
In the March 10, 2007 Wall Street Journal, Dr Weiss was quoted as saying, the "bulk of the data that has raised concerns" came when patients were given higher doses, whether they were experiencing anemia from kidney disease or cancer treatment.
The evidence shows that "this type of strategy is not beneficial and, in fact, has some evidence of harm," she said.
On March 9, 2007, the FDA also issued a public health advisory based on the results of a number of studies and warned doctors treating patients with kidney disease or cancer not to push hemoglobin levels over 12 grams per deciliter of blood.
The FDA noted a higher chance of death and an increased rate of tumor growth in cancer patients with advanced head and neck cancer receiving radiation therapy and in patients with metastatic breast cancer receiving chemotherapy, when ESAs were given to maintain levels of more than 12.
There was also a higher rate of death reported, but no fewer blood transfusions, when ESAs were given to patients with cancer and anemia who were not receiving chemotherapy.
A higher chance of death and an increased number of blood clots, strokes, heart failure and heart attacks were found in patients with chronic kidney failure when ESAs were given to raise hemoglobin levels of more than 12.
The Advisory warned that a higher risk of blood clots was also reported in patients who were scheduled for major surgery and received ESAs.
The FDA pointed out that ESAs are not approved for treatment of the symptoms of anemia, such as fatigue in patients with cancer, surgical patients and patients with HIV.
The drug makers have been using direct-to-consumer advertising to increase sales with cancer patients by claiming the drugs could restore energy and reduce fatigue in patients undergoing chemotherapy. But the FDA says there has never been any evidence to support claims that ESAs could increase energy or ease fatigue in patients undergoing cancer treatment.
In recent months, Congress has been investigating Medicare reimbursement policies that guarantee dialysis clinics a 6% profit for administering ESAs, since it became apparent that patients are being given higher doses than needed. Critics say any deal that allows for cost plus payments comes with a built-in incentive to provide unnecessary services.
On October 24, 2006, the Boston Globe reported that dialysis clinics are also increasing profits by administering ESAs intravenously instead of by injection, and about 95% of the patients receive the drugs intravenously.
Clinics could use 30% less, the Globe says, because when ESAs are injected they stay in the system longer and require a lower dose. A 2004 analysis found patients injected with the drugs were given 21% less, for a potential total savings of about $375 million.
The two clinic chains that dominate the dialysis industry are DaVita, with over 1,200 clinics, and Fresenius Medical Care, with about 1,500. According to the Globe, the clinics claim the intravenous method is more convenient because patients are already hooked up to IVs for dialysis.
Critics think differently. "The industry is incentivized to use intravenous because they make a profit margin on every unit they administer," said Dr Peter Crooks, who oversees dialysis for 3,000 patients for Kaiser Permanente where most patients receive injections.
In an April 11, 2007 report, Bernstein Research estimates that dose volume in renal patients could fall as much as 25% if doctors abide by the new black box warning and insurers refuse to pay for the drugs in patients with hemoglobin levels over 12.
On November 17, 2006, the British journal Lancet reported that about half of all dialysis patients have hemoglobin levels above what the FDA considers safe, and about 20% of patients experience dangerously high levels, creating a risk for heart attack and stroke.
Medicare has provided coverage for all patients with End Stage Renal Disease since 1972, and according to the House Ways and Means Committee, the government pays for 93% of services provided to dialysis patients, at a cost of about $2 billion a year.
In 2005, the drugs darbepoetin and epoetin, commonly used by patients who must undergo dialysis, accounted for almost 20% of the $13 billion spent on the Medicare Part B drug plan, and total sales for these drugs worldwide topped $9 billion.
Amgen manufactures and markets darbepoetin as Aranesp, and epoetin is sold under the names Procrit and Epogen. But Procrit is distributed by Ortho Biotech Products, a Johnson & Johnson subsidiary. There are no generic versions of these medications.
The drugs are among the top sellers for both companies. Amgen's Epogen and Aranesp combined sales were $6.6 billion in 2006, nearly half of the company's total revenues. Johnson and Johnson's revenues were $3.2 billion in 2006, making it the company's second-biggest-selling drug, according to Forbes.com on March 21, 2007.
The drugs are man-made versions of erythropoietin, a hormone normally produced in the kidneys, and belong to a class of drugs known as Erythropoiesis Stimulating Agents. ESA's are used to treat anemia in raising hemoglobin levels by increasing the number of red blood cells in the body. Anemia's severity is monitored by a patient's hematocrit, the proportion of red blood cells in whole blood, which should stay between 33% and 36%.
According to the FDA, ESAs are approved to treat anemia in patients with chronic kidney failure, patients with cancer whose anemia is caused by chemotherapy, patients scheduled for major surgery to reduce potential blood transfusions, and for the treatment of anemia due to zidovudine therapy in HIV patients.
But Aranesp, Epogen, and Procrit are being administered "off label" for uses and in doses not approved by the FDA. For instance, an Amgen vice president recently estimated that about 10% to 12% of Aranesp sales are for the unapproved use of treating "anemia of cancer" in patients who are not undergoing chemotherapy.
A recent company study conducted to support FDA approval for using the drug to treat "anemia of cancer" in patients with cancer in remission who were not undergoing chemotherapy, revealed that Aranesp actually increased the risk of death in these patients.
The February 2, 2007, "Cancer Letter ," a newsletter for cancer professionals, warns, "If the findings of the recently reported study hold up, more than one in 10 Americans getting Aranesp without chemotherapy has no chance of benefiting from the agent and could be harmed or killed by it, experts say."
The report estimated that up to 12% of the use of ESAs in the US was for this condition.
After reviewing the results of this study and several others, on March 9, 2007, the FDA announced that black box warnings would be added to the labels for all ESAs and recommended using the lowest possible dose to raise the hemoglobin concentration to the lowest level.
The FDA-approved labeling for the drugs says patients should have a hemoglobin level of 10-12 grams per deciliter of blood, and patients are considered to need treatment if their levels fall below 10 grams.
During a press briefing, Dr Richard Pazdur, director of the FDA's Office of Oncology Drug Products at the Center for Drug Evaluation and Research, said the black box warning was being added based on the results of several recently reported clinical trials.
Dr Karen Weiss, deputy director of the Office of Oncology Drug Products, said the FDA became concerned after receiving the results from several trials evaluating the aggressive use of ESAs to raise hemoglobin levels higher than listed on their approved labels.
In the March 10, 2007 Wall Street Journal, Dr Weiss was quoted as saying, the "bulk of the data that has raised concerns" came when patients were given higher doses, whether they were experiencing anemia from kidney disease or cancer treatment.
The evidence shows that "this type of strategy is not beneficial and, in fact, has some evidence of harm," she said.
On March 9, 2007, the FDA also issued a public health advisory based on the results of a number of studies and warned doctors treating patients with kidney disease or cancer not to push hemoglobin levels over 12 grams per deciliter of blood.
The FDA noted a higher chance of death and an increased rate of tumor growth in cancer patients with advanced head and neck cancer receiving radiation therapy and in patients with metastatic breast cancer receiving chemotherapy, when ESAs were given to maintain levels of more than 12.
There was also a higher rate of death reported, but no fewer blood transfusions, when ESAs were given to patients with cancer and anemia who were not receiving chemotherapy.
A higher chance of death and an increased number of blood clots, strokes, heart failure and heart attacks were found in patients with chronic kidney failure when ESAs were given to raise hemoglobin levels of more than 12.
The Advisory warned that a higher risk of blood clots was also reported in patients who were scheduled for major surgery and received ESAs.
The FDA pointed out that ESAs are not approved for treatment of the symptoms of anemia, such as fatigue in patients with cancer, surgical patients and patients with HIV.
The drug makers have been using direct-to-consumer advertising to increase sales with cancer patients by claiming the drugs could restore energy and reduce fatigue in patients undergoing chemotherapy. But the FDA says there has never been any evidence to support claims that ESAs could increase energy or ease fatigue in patients undergoing cancer treatment.
In recent months, Congress has been investigating Medicare reimbursement policies that guarantee dialysis clinics a 6% profit for administering ESAs, since it became apparent that patients are being given higher doses than needed. Critics say any deal that allows for cost plus payments comes with a built-in incentive to provide unnecessary services.
On October 24, 2006, the Boston Globe reported that dialysis clinics are also increasing profits by administering ESAs intravenously instead of by injection, and about 95% of the patients receive the drugs intravenously.
Clinics could use 30% less, the Globe says, because when ESAs are injected they stay in the system longer and require a lower dose. A 2004 analysis found patients injected with the drugs were given 21% less, for a potential total savings of about $375 million.
The two clinic chains that dominate the dialysis industry are DaVita, with over 1,200 clinics, and Fresenius Medical Care, with about 1,500. According to the Globe, the clinics claim the intravenous method is more convenient because patients are already hooked up to IVs for dialysis.
Critics think differently. "The industry is incentivized to use intravenous because they make a profit margin on every unit they administer," said Dr Peter Crooks, who oversees dialysis for 3,000 patients for Kaiser Permanente where most patients receive injections.
In an April 11, 2007 report, Bernstein Research estimates that dose volume in renal patients could fall as much as 25% if doctors abide by the new black box warning and insurers refuse to pay for the drugs in patients with hemoglobin levels over 12.
On November 17, 2006, the British journal Lancet reported that about half of all dialysis patients have hemoglobin levels above what the FDA considers safe, and about 20% of patients experience dangerously high levels, creating a risk for heart attack and stroke.
Saturday, August 7, 2010
J&J Concealed Dangers of Ortho Evra Birth Control Patch
Evelyn Pringle April 16, 2007
Tens of millions of prescriptions have been written for Johnson & Johnson's Ortho Evra birth control patch since it arrived on the market in 2002, and medical experts say the patch has harmed thousands of young women of childbearing age.
In September 2006, the FDA warned that use of the patch, made by the Ortho-McNeil division of J&J, increases the risk of blood clots, which can lead to heart attack and stroke.
Because the patch releases hormones directly into the blood stream, medical experts say, a much higher concentration of hormones enters the body than with birth control pills. A November 2005, FDA advisory reported that patch users were exposed to about 60% more estrogen than women on the pill.
A recent study in the February 2007, journal, Obstetrics and Gynecology, of 49,000 women who used the Ortho patch, and 202,000 who used oral contraceptives, found that blood clots or "venous thromboembolism" occurred in patch users at a rate of 2.2 times higher than with women on the pill.
Legal experts says proving causation in these cases will be easy because blood clots in young women are almost unheard of. No doubt due to the recognition of this fact, when the first lawsuits were filed, J&J quickly began settling cases out of court for substantial sums of money, trying to keep a lid on the news that women were being injured by the patch.
J&J has already settled lawsuits in state courts in New Jersey, Texas, and California, and federal courts in North Carolina and Pennsylvania, according to Bloomberg on April 2, 2007.
Texas attorney, Ray Chester, told Bloomberg that one settlement involved a 40-year-old woman with 2 children, who had a massive stroke after only 12 days on the patch and is now a quadriplegic with brain damage and requires around the clock medical care.
However, as the number of lawsuits multiplied, that strategy of quietly settling out of court could not continue for obvious reasons. J&J's Annual Report filed with the SEC in February 2007, states that, as of December 31, 2006, "there were approximately 1,500 claimants who have filed lawsuits or made claims regarding injuries allegedly due to ORTHO EVRA."
Documents revealed in litigation, prove that J&J knew about the high rate of blood clots because they show the company had been analyzing the FDA's reports on injuries and deaths in women using the patch, and had even compiled charts showing the higher rates of clots and deaths when compared to women taking birth-control pills.
One memo from 2003, reveals that the company refused to conduct a study to compare the rate of adverse events with the patch to its Ortho-Cyclen pill because there was "too high a chance that study may not produce a positive result for Evra" and a "risk that Ortho Evra may be the same or worse than Ortho-Cyclen."
Newly released documents show that, instead of warning consumers and prescribing physicians about the clot problems, Johnson & Johnson has been doing everything in its power to stop the negative information about the patch from becoming public.
Documents unsealed this month by Superior Court Judge, Bryan Garruto, in a New Jersey state court proceeding involving more than 300 lawsuits, reveal that J&J bought up dozens of internet domain names related to the Ortho patch in an attempt to stop negative information from appearing on the internet.
By using the standard trick of claiming the documents contained trade secrets, J&J had previously obtained a court order to keep them sealed so the public would not learn about the extent of the company's damage control efforts.
But in granting a motion by the plaintiffs' attorneys to unseal the documents, Judge Garruto said they were not entitled to a protective order because the information did not constitute trade secrets that, if revealed, would benefit J&J's competitors.
One document released calls for, "Defensive actions to minimize impact of negative presence," to include buying internet domain names, monitoring blogs and purchasing the top key words related to the patch that would be picked up by Google and Yahoo search engines.
Apparently, drug companies do this on a regular basis. According to Kent Jarrell, a spokesman for J&J, quoted by Bloomberg News on April 2, 2007: "The purchase of the domain names is a standard and accepted business practice for companies that are trying to prevent product disparagement and to safeguard the defendant's reputation."
Legal experts view the situation differently. According to Attorney, Derek Braslow, of the Conshohocken, Pennsylvania firm of Pogust & Braslow, "While J&J's purchase of key internet search terms and domain names does not prove that the Ortho patch causes injuries," he says, "J&J's conduct, like the conduct of most drug companies, does show an intentional disregard for the victims of its deadly drug."
He does not find the drug maker's conduct surprising. "J&J has only taken the next step in the natural evolution of marketing," Mr Braslow explains, "promote the drug at all costs during the life of the patent but eliminate all marketing and promotion after the money has been made and the victims start seeking answers and advocacy."
"Purchasing the domain names has nothing to do with the merits of the litigation," he says, "it has everything to do with damage control, protecting their drug at all costs and preventing victims from seeking and finding justice."
After lives have been lost and families devastated as a result of using the patch, he states, the company is attempting to prevent the victims from finding legal counsel. "Instead of coming forward with the truth behind the patch," he notes, "the company has gone to extraordinary measures to stop victims from finding attorneys to represent them."
Attorney, Ted Chabasinski, who recently worked on a case involving the release of damaging Zyprexa documents that Eli Lilly had successfully kept hidden with a court order while settling out of court with about 26,000 litigants, agrees that J&J's conduct is standard procedure when it comes to concealing damaging information about pharmaceutical products.
"What Johnson and Johnson is doing," he says, "just reflects drug company practices in general."
"None of them want the public to know that their products are dangerous and often ineffective as well," Mr Chabasinski notes.
"America must wake up soon," he warns, "to what these greedy corporations are doing to our health."
"We need politicians," he states, "who will stand up to the drug companies, and judges who will recognize that when drug company executives approve hiding the deathly effects of their drugs, thus killing thousands of people, they should be put in prison."
"It isn't enough," he advises, "to make the companies pay damages."
"Nothing will stop these practices," he warns, "except holding the people who run these corporations personally responsible for their criminal behavior."
According to FDA records obtained by the Associated Press with a FOIA request in 2005, in one 18-month period, there were 9,116 adverse events reported by women using the patch, a rate 7 times higher than women taking oral contraceptives.
A factor that must always be considered when assessing the number of people who may have been harmed by a product is that the FDA estimates that only 1% to 10% of adverse events are ever reported, which means the number of women harmed by the patch is definitely much higher. In 2005 alone, doctors wrote more than 9.4 million prescriptions for the patch, according to the pharmaceutical industry-tracking firm, IMS Health.
The review of records by the Associated Press revealed that the FDA knew that blood clots were at least 3 times more common with the patch before the device was approved.
The records show that in 2000, FDA doctors reviewing J&J's clinical trials warned that clots could be a problem with the patch after finding that 2 women were treated for serious conditions where blood clots had traveled to their lungs.
One reviewer said, "The label should clearly reflect this reviewer's safety concern about a potential increased risk." But in the end, the label did not contain the warning, and there was no requirement for follow-up studies other than ordinary reviews of voluntary reports.
Tens of millions of prescriptions have been written for Johnson & Johnson's Ortho Evra birth control patch since it arrived on the market in 2002, and medical experts say the patch has harmed thousands of young women of childbearing age.
In September 2006, the FDA warned that use of the patch, made by the Ortho-McNeil division of J&J, increases the risk of blood clots, which can lead to heart attack and stroke.
Because the patch releases hormones directly into the blood stream, medical experts say, a much higher concentration of hormones enters the body than with birth control pills. A November 2005, FDA advisory reported that patch users were exposed to about 60% more estrogen than women on the pill.
A recent study in the February 2007, journal, Obstetrics and Gynecology, of 49,000 women who used the Ortho patch, and 202,000 who used oral contraceptives, found that blood clots or "venous thromboembolism" occurred in patch users at a rate of 2.2 times higher than with women on the pill.
Legal experts says proving causation in these cases will be easy because blood clots in young women are almost unheard of. No doubt due to the recognition of this fact, when the first lawsuits were filed, J&J quickly began settling cases out of court for substantial sums of money, trying to keep a lid on the news that women were being injured by the patch.
J&J has already settled lawsuits in state courts in New Jersey, Texas, and California, and federal courts in North Carolina and Pennsylvania, according to Bloomberg on April 2, 2007.
Texas attorney, Ray Chester, told Bloomberg that one settlement involved a 40-year-old woman with 2 children, who had a massive stroke after only 12 days on the patch and is now a quadriplegic with brain damage and requires around the clock medical care.
However, as the number of lawsuits multiplied, that strategy of quietly settling out of court could not continue for obvious reasons. J&J's Annual Report filed with the SEC in February 2007, states that, as of December 31, 2006, "there were approximately 1,500 claimants who have filed lawsuits or made claims regarding injuries allegedly due to ORTHO EVRA."
Documents revealed in litigation, prove that J&J knew about the high rate of blood clots because they show the company had been analyzing the FDA's reports on injuries and deaths in women using the patch, and had even compiled charts showing the higher rates of clots and deaths when compared to women taking birth-control pills.
One memo from 2003, reveals that the company refused to conduct a study to compare the rate of adverse events with the patch to its Ortho-Cyclen pill because there was "too high a chance that study may not produce a positive result for Evra" and a "risk that Ortho Evra may be the same or worse than Ortho-Cyclen."
Newly released documents show that, instead of warning consumers and prescribing physicians about the clot problems, Johnson & Johnson has been doing everything in its power to stop the negative information about the patch from becoming public.
Documents unsealed this month by Superior Court Judge, Bryan Garruto, in a New Jersey state court proceeding involving more than 300 lawsuits, reveal that J&J bought up dozens of internet domain names related to the Ortho patch in an attempt to stop negative information from appearing on the internet.
By using the standard trick of claiming the documents contained trade secrets, J&J had previously obtained a court order to keep them sealed so the public would not learn about the extent of the company's damage control efforts.
But in granting a motion by the plaintiffs' attorneys to unseal the documents, Judge Garruto said they were not entitled to a protective order because the information did not constitute trade secrets that, if revealed, would benefit J&J's competitors.
One document released calls for, "Defensive actions to minimize impact of negative presence," to include buying internet domain names, monitoring blogs and purchasing the top key words related to the patch that would be picked up by Google and Yahoo search engines.
Apparently, drug companies do this on a regular basis. According to Kent Jarrell, a spokesman for J&J, quoted by Bloomberg News on April 2, 2007: "The purchase of the domain names is a standard and accepted business practice for companies that are trying to prevent product disparagement and to safeguard the defendant's reputation."
Legal experts view the situation differently. According to Attorney, Derek Braslow, of the Conshohocken, Pennsylvania firm of Pogust & Braslow, "While J&J's purchase of key internet search terms and domain names does not prove that the Ortho patch causes injuries," he says, "J&J's conduct, like the conduct of most drug companies, does show an intentional disregard for the victims of its deadly drug."
He does not find the drug maker's conduct surprising. "J&J has only taken the next step in the natural evolution of marketing," Mr Braslow explains, "promote the drug at all costs during the life of the patent but eliminate all marketing and promotion after the money has been made and the victims start seeking answers and advocacy."
"Purchasing the domain names has nothing to do with the merits of the litigation," he says, "it has everything to do with damage control, protecting their drug at all costs and preventing victims from seeking and finding justice."
After lives have been lost and families devastated as a result of using the patch, he states, the company is attempting to prevent the victims from finding legal counsel. "Instead of coming forward with the truth behind the patch," he notes, "the company has gone to extraordinary measures to stop victims from finding attorneys to represent them."
Attorney, Ted Chabasinski, who recently worked on a case involving the release of damaging Zyprexa documents that Eli Lilly had successfully kept hidden with a court order while settling out of court with about 26,000 litigants, agrees that J&J's conduct is standard procedure when it comes to concealing damaging information about pharmaceutical products.
"What Johnson and Johnson is doing," he says, "just reflects drug company practices in general."
"None of them want the public to know that their products are dangerous and often ineffective as well," Mr Chabasinski notes.
"America must wake up soon," he warns, "to what these greedy corporations are doing to our health."
"We need politicians," he states, "who will stand up to the drug companies, and judges who will recognize that when drug company executives approve hiding the deathly effects of their drugs, thus killing thousands of people, they should be put in prison."
"It isn't enough," he advises, "to make the companies pay damages."
"Nothing will stop these practices," he warns, "except holding the people who run these corporations personally responsible for their criminal behavior."
According to FDA records obtained by the Associated Press with a FOIA request in 2005, in one 18-month period, there were 9,116 adverse events reported by women using the patch, a rate 7 times higher than women taking oral contraceptives.
A factor that must always be considered when assessing the number of people who may have been harmed by a product is that the FDA estimates that only 1% to 10% of adverse events are ever reported, which means the number of women harmed by the patch is definitely much higher. In 2005 alone, doctors wrote more than 9.4 million prescriptions for the patch, according to the pharmaceutical industry-tracking firm, IMS Health.
The review of records by the Associated Press revealed that the FDA knew that blood clots were at least 3 times more common with the patch before the device was approved.
The records show that in 2000, FDA doctors reviewing J&J's clinical trials warned that clots could be a problem with the patch after finding that 2 women were treated for serious conditions where blood clots had traveled to their lungs.
One reviewer said, "The label should clearly reflect this reviewer's safety concern about a potential increased risk." But in the end, the label did not contain the warning, and there was no requirement for follow-up studies other than ordinary reviews of voluntary reports.
Drug Eluting Stent Patients Beware
Evelyn Pringle January 24, 2007
Drug eluting stents were promoted as working so much better than the old bare metal stents that 6 million people worldwide have received them in the few years since the arrived on the market.
"It was a modern record for any medical device," the Boston Globe reported on December 4, 2006. Some 2 to 3 million people in the US now carry one of these devices in an artery, according to FDA estimates, with new implants topping 900,000 per year.
Only two brands of DES are sold in the US, the Taxus, by Boston Scientific, and the Cypher, by Johnson & Johnson's Cordis Division.
The trials submitted by the DES makers to obtain FDA approval for use in limited procedures with non-complex patients with single-vessel heart disease, involved a low risk population. However, off-label DES use for procedures not approved by the FDA has become rampant and according to the agency:
"It is estimated that a majority of DES are implanted in lesions outside of their current indications for use, such as in-stent restenosis lesions, bifurcation lesions, coronary artery bypass grafts, acute myocardial infarction, chronic total occlusions, overlapping and multiple stents per vessel and in patients with multivessel disease and chronic renal insufficiency."
Surgeons have been implanting the new devices in every kind of heart patient. And for good reason. The stenting business represents maga bucks to device makers, hospitals and surgeons alike. In the US, the implant procedure itself costs $38,203, according to a report by the Associated Press on December 26, 2006.
But as has been the case with so many pharmaceutical products in recent years, after being massively promoted, and implanted in millions of patients for indications not approved, DES are proving to be no better than the bare metal stents, and in fact research has shown them to worse because they come with more adverse reactions.
In early December 2006, the FDA's Circulatory System Devices Advisory Committee held a public meeting to review data on thrombosis both when DES were used according to their label and when they are implanted off-label for unapproved uses, and to address the appropriate duration for the use of the blood-thinning drug, Plavix, with DES patients.
In the briefing provided to the Committee before the hearing, the FDA informed the panel that recent presentations at scientific meetings had indicated a small but significant increase in the rates of death or myocardial infarction, and non-cardiac mortality, in DES patients when compared to patients who received bare metal stents.
The briefing included a specific discussion of presentations made at the Transcatheter Cardiovascular Therapeutics meeting, in October 2006, where doctors, Martin Leon and Gregg Stone, presented a meta-analyses of patient data from the Cypher and Taxus clinical trails.
Based on these analyses, Dr Stuart Pocock reported that after one year, five Cypher patients, compared to no bare metal patients, had experienced late thrombosis, and with the Taxus, thrombosis occurred in nine patients after one year compared with two bare metal stent patients.
Last year, the Swiss government commissioned a study to determine whether the DES were worth their price of between $2,200 and $2,700, when compared to the $600 to $800 for bare metal stents, and also to test how long Plavix should be prescribed to patients after the implantation of a DES to prevent blood clots from developing.
The study appeared in the December 19, 2006, Journal of the American College of Cardiology, and reported that patients with DES had double the risk of cardiac problems after stopping Plavix compared to patients with bare metal stents.
The Swiss researchers, led by Dr Matthias Pfisterer, found that when patients stop taking Plavix, they had a small but serious risk of blood clots leading to death or heart attack.
The lead author noted that the majority of DES implants in the study were off-label. "About two-thirds of our patients were really treated with off-label use of drug-eluting stents," Dr Pfisterer told WebMD on December 5, 2006.
"The FDA label says these are only for stable patients with limited disease," he notes. "But, in fact," he told WebMD, "most doctors who use drug-eluting stents use them in unstable patients and in more complex disease."
In an editorial accompanying the Pfisterer study, Dr Robert Califf and Dr Robert Harrington, warned that research on DES has not kept up with clinical realities. "As is frequently seen with new cardiac devices," they wrote, "rapid increase in clinical adoption quickly outstripped what is known about the device from limited clinical trials."
Medical professionals say an important point to keep in mind when considering the risks associated with the DES is that these devices have only been on the market in the US for less than four years and that many more unknown risks could surface in years to come.
More problems may have already surfaced according to Dr Joseph Muhlestein, a professor at the University of Utah. He told ABC New's Healthday reporter on December 4, 2006, that his research group has followed patients receiving DES implants very carefully and has found "something we don't understand."
As expected, he said, the DES did reduce artery closure at the site where they were implanted, but the incidence of artery problems at other sites occurred "significantly more often than when we used bare-metal stents," he told Healthday.
So, the overall incidence of artery problems ended up being the same, regardless of which type of stent was implanted, Dr Muhlestein said.
It is possible that the problem occurred because DES were used on more high-risk patients, he noted. But it's also possible, he said, that the DES interfered with the endothelium, the delicate tissue that lines the arteries.
These doubts have caused some doctors to cut back on DES use. "We used to use them in 90 percent of cases," Dr Muhlestein told Healthday. "Now, it's about 40 percent."
Finally, experts are warning that if unexpected health problems do develop in patients already implanted with the DES, removal of the stent is not possible because once it is placed in the body, the tissue in the artery grows over the stent.
Drug eluting stents were promoted as working so much better than the old bare metal stents that 6 million people worldwide have received them in the few years since the arrived on the market.
"It was a modern record for any medical device," the Boston Globe reported on December 4, 2006. Some 2 to 3 million people in the US now carry one of these devices in an artery, according to FDA estimates, with new implants topping 900,000 per year.
Only two brands of DES are sold in the US, the Taxus, by Boston Scientific, and the Cypher, by Johnson & Johnson's Cordis Division.
The trials submitted by the DES makers to obtain FDA approval for use in limited procedures with non-complex patients with single-vessel heart disease, involved a low risk population. However, off-label DES use for procedures not approved by the FDA has become rampant and according to the agency:
"It is estimated that a majority of DES are implanted in lesions outside of their current indications for use, such as in-stent restenosis lesions, bifurcation lesions, coronary artery bypass grafts, acute myocardial infarction, chronic total occlusions, overlapping and multiple stents per vessel and in patients with multivessel disease and chronic renal insufficiency."
Surgeons have been implanting the new devices in every kind of heart patient. And for good reason. The stenting business represents maga bucks to device makers, hospitals and surgeons alike. In the US, the implant procedure itself costs $38,203, according to a report by the Associated Press on December 26, 2006.
But as has been the case with so many pharmaceutical products in recent years, after being massively promoted, and implanted in millions of patients for indications not approved, DES are proving to be no better than the bare metal stents, and in fact research has shown them to worse because they come with more adverse reactions.
In early December 2006, the FDA's Circulatory System Devices Advisory Committee held a public meeting to review data on thrombosis both when DES were used according to their label and when they are implanted off-label for unapproved uses, and to address the appropriate duration for the use of the blood-thinning drug, Plavix, with DES patients.
In the briefing provided to the Committee before the hearing, the FDA informed the panel that recent presentations at scientific meetings had indicated a small but significant increase in the rates of death or myocardial infarction, and non-cardiac mortality, in DES patients when compared to patients who received bare metal stents.
The briefing included a specific discussion of presentations made at the Transcatheter Cardiovascular Therapeutics meeting, in October 2006, where doctors, Martin Leon and Gregg Stone, presented a meta-analyses of patient data from the Cypher and Taxus clinical trails.
Based on these analyses, Dr Stuart Pocock reported that after one year, five Cypher patients, compared to no bare metal patients, had experienced late thrombosis, and with the Taxus, thrombosis occurred in nine patients after one year compared with two bare metal stent patients.
Last year, the Swiss government commissioned a study to determine whether the DES were worth their price of between $2,200 and $2,700, when compared to the $600 to $800 for bare metal stents, and also to test how long Plavix should be prescribed to patients after the implantation of a DES to prevent blood clots from developing.
The study appeared in the December 19, 2006, Journal of the American College of Cardiology, and reported that patients with DES had double the risk of cardiac problems after stopping Plavix compared to patients with bare metal stents.
The Swiss researchers, led by Dr Matthias Pfisterer, found that when patients stop taking Plavix, they had a small but serious risk of blood clots leading to death or heart attack.
The lead author noted that the majority of DES implants in the study were off-label. "About two-thirds of our patients were really treated with off-label use of drug-eluting stents," Dr Pfisterer told WebMD on December 5, 2006.
"The FDA label says these are only for stable patients with limited disease," he notes. "But, in fact," he told WebMD, "most doctors who use drug-eluting stents use them in unstable patients and in more complex disease."
In an editorial accompanying the Pfisterer study, Dr Robert Califf and Dr Robert Harrington, warned that research on DES has not kept up with clinical realities. "As is frequently seen with new cardiac devices," they wrote, "rapid increase in clinical adoption quickly outstripped what is known about the device from limited clinical trials."
Medical professionals say an important point to keep in mind when considering the risks associated with the DES is that these devices have only been on the market in the US for less than four years and that many more unknown risks could surface in years to come.
More problems may have already surfaced according to Dr Joseph Muhlestein, a professor at the University of Utah. He told ABC New's Healthday reporter on December 4, 2006, that his research group has followed patients receiving DES implants very carefully and has found "something we don't understand."
As expected, he said, the DES did reduce artery closure at the site where they were implanted, but the incidence of artery problems at other sites occurred "significantly more often than when we used bare-metal stents," he told Healthday.
So, the overall incidence of artery problems ended up being the same, regardless of which type of stent was implanted, Dr Muhlestein said.
It is possible that the problem occurred because DES were used on more high-risk patients, he noted. But it's also possible, he said, that the DES interfered with the endothelium, the delicate tissue that lines the arteries.
These doubts have caused some doctors to cut back on DES use. "We used to use them in 90 percent of cases," Dr Muhlestein told Healthday. "Now, it's about 40 percent."
Finally, experts are warning that if unexpected health problems do develop in patients already implanted with the DES, removal of the stent is not possible because once it is placed in the body, the tissue in the artery grows over the stent.
Friday, August 6, 2010
Birth Control Patch Lawsuits against J&J Piling Up
Evelyn Pringle October 23, 2006
On October 17, 2006, News Inferno announced that another lawsuit had been filed against Ortho-McNeil, a division of Johnson & Johnson, on behalf of a young Idaho women who was 17 when she was prescribed the Ortho Evra birth control patch, and in less than a month, she developed deep vein thrombosis, a potentially fatal blood clot condition.
The lawsuit alleges that J&J failed to properly test the patch before placing it on the market and knowingly misled consumers about the safety and risks associated with the patch when compared to other types of birth control products.
In the lawsuit, Katy McKellips Braman, describes the onset of the condition as a pronounced swelling in her left leg that gradually increased over the course of a few days. The condition required Ms Braman to be hospitalized and she is now forced to take anti-clotting drugs daily.
She is suing J&J for damages to include all future medical expenses incurred in treating the condition.
Two days later, on October 19, 2006, the Parker & Waichman, LLP law firm announced that it had filed a lawsuit against the company in New Jersey on behalf of a 25-year-old Wisconsin women who was diagnosed with bilateral pulmonary emboli after 6 months of using the patch.
Parker & Waichman has already filed numerous patch related lawsuits and says it plans to file a "significant number" of additional cases by the end of 2006.
The lawsuit states that the injured victim in the case was taken to the emergency room on August 24, 2004, after experiencing lightheadedness, shortness of breath and chest pain, where diagnostic tests revealed bilateral pulmonary emboli.
According to the National Institute of Neurological Disorders and Stroke: (1) thrombosis is the formation of a clot within a blood vessel of the brain or neck; and (2) embolism is the movement of a clot from another part of the body to the neck or brain. Pulmonary embolism is a sudden blockage in a lung artery, usually due to a blood clot that traveled to the lung from the leg, but clots can also form in the pelvic vein.
After being diagnosed, the Wisconsin woman was hospitalized and received the drugs Heparin and Coumadin, as anticoagulant therapy, and according to the lawsuit, will need anticoagulant medication for a protracted period of time and possibly for the remainder of her life.
These new lawsuits, along with the hundreds of others already filed all over the country, allege that Ortho-McNeil was aware of the increased risks of blood clots, heart attack and stroke associated with the birth control patch even before the device was approved for use in the US, and that once approved, the company failed to adequately warn potential users about the risks.
To substantiate this claim in part, attorneys point to an internal Ortho-McNeil memo that shows that in 2003, the company refused to fund a study comparing the patch to its Ortho-Cyclen pill because of concerns that there was "too high a chance that study may not produce a positive result for Evra", and there was a "risk that Ortho Evra may be the same or worse than Ortho-Cyclen."
The plaintiff's attorney also list Ortho-McNeil's own records obtained and made public by CBS news, that show the company received some 500 reports of serious events associated with the patch between April 2002 and December 2004, during a time when only 61 such reports were received involving all types of birth control pills.
These records also show that there were 4 times as many strokes in women using the patch and that in medically confirmed cases, the risk of blood clots was found to be 14 times higher with the patch.
Users of the Ortho adhesive patch apply it to their body and change it once a week for three weeks and then do not wear it during the fourth week. The patch is intended to release 20 micrograms of estrogen into the bloodstream every 24 hours.
It is widely known that exposure to estrogen increases the risk of blood clots. The first FDA warning about the increased risks of blood clots with the patch was issued on November 10, 2005, and for the first time, Ortho-McNeil admitted that women who used the patch may be exposed to up to 60% more estrogen than women taking a birth control pill.
"FDA is announcing a revision to the label for the drug Ortho Evra," the agency said. "This change includes a new bolded warning about higher exposure to estrogen."
"Higher levels of estrogen," the FDA warned, "may put some women at increased risk for getting blood clots."
By the time of this warning, the FDA had received more than 9,000 reports of adverse events related to the patch in a 17-month period, while the Ortho Tri-Cyclen birth control pill, only generated a little over 1,200 adverse reports in a 6-year period.
In addition, during a 12-month period, 44 serious injuries or deaths were found to be associated with the patch, while only 17 such reports were found to be linked to the birth control pill during a similar time frame.
Critics say the drastic difference in serious events is further magnified when considering that the number of women using the Ortho Tri-Cyclen pill was 6 times the number of women using the Ortho Evra patch.
According to Jason Mark, an attorney at Parker & Waichman, LLP, who heads the firm's mass tort department, "The product needs to be withdrawn from the market so that it can no longer cause harm."
"The notion that periodic warnings of Ortho Evra's increased risks is sufficient," Mr Mark said in a press release, "to protect the health of women is misguided."
"There are many safer alternative forms of hormonal contraception than the patch," he states. "This is not a last resort, life saving medication."
On September 21, 2006, the law firm announced that it believes a new study that found women using the Ortho patch were twice as likely to develop blood clots compared with those using birth control pills provides further evidence that the patch is dangerous and should be recalled from the market.
As a result of this study, the firm noted, the FDA updated Ortho Evra's warning to reflect that women using the patch faced twice the risk of blood clots as women on the pill.
"The FDA also asked Ortho McNeil to conduct a longer study of the contraceptive patch to evaluate the risks of blood clots, heart attack and stroke," the Parker & Waichman press release stated.
According to its 2005 Annual Report, J&J sold $1.1 billion in contraceptives in 2005, but the report predicted a decline in sales for 2006 because of "labeling changes and negative media coverage concerning product safety."
Warnings to young women to stay away from the patch are growing in number. On September 29, 2006, the Editorial Board of the Exponent, a Purdue college newspaper, said women should use the birth control pill instead of the Ortho Evra birth control patch and also said the patch should be removed from the market.
The Exponent, published by the Purdue Student Publishing Foundation, is Indiana's largest collegiate daily newspaper and is primarily a student operation.
According to the Wall Street Journal, in providing health care services to 42,000 students, Pennsylvania State University is no longer writing prescriptions for the patch.
The Journal also reported that similar actions were being taken by health officials at other universities including Stanford, the University of Texas at Austin, the University of California, Berkeley, and the Connecticut College in New London.
Legal experts say the patch maker is scrambling to settle as many of these lawsuits as quickly and silently as possible with substantial monetary awards that come with the signing of confidential settlement agreements because it does not want to risk the public spectacle of a steady stream of young injured women parading before a jury.
"Ortho-McNeil Pharmaceutical," the April 9, 2006 New York Post reported "has settled a dozen lawsuits for millions of dollars in the last few months."
On May 2, 2006, a J&J attorney wrote a judge in New Jersey to say that 11 women who filed suit in that state had received settlements, although the amounts were kept confidential.
Also on May 2, 2006, a J&J attorney informed an Ohio judge that the company was prepared to settle all cases where the plaintiffs were hospitalized for pulmonary embolisms, deep vein thrombosis, heart attacks or strokes.
On May 16, 2006, the New Jersey Law Journal quoted a plaintiff's attorney who estimates that "many of these cases are seven figures, many are probably substantial six-figure cases."
However, settling these lawsuits as quickly as they are filed may not turn out to be so easy. Critics say there are likely to be tens of thousands more women spread out all over the country who do not yet realize that their health problems are caused by the patch.
Which may very well be true, because even though the FDA says it has received about 9,000 reports of adverse events related to the patch, the agency acknowledges that only between 1% and 10% of adverse events ever get reported and according to Bloomberg News on Mary 13, 2006, Johnson & Johnson has sold patches to 5 million women since the launch of the product in 2002.
On October 17, 2006, News Inferno announced that another lawsuit had been filed against Ortho-McNeil, a division of Johnson & Johnson, on behalf of a young Idaho women who was 17 when she was prescribed the Ortho Evra birth control patch, and in less than a month, she developed deep vein thrombosis, a potentially fatal blood clot condition.
The lawsuit alleges that J&J failed to properly test the patch before placing it on the market and knowingly misled consumers about the safety and risks associated with the patch when compared to other types of birth control products.
In the lawsuit, Katy McKellips Braman, describes the onset of the condition as a pronounced swelling in her left leg that gradually increased over the course of a few days. The condition required Ms Braman to be hospitalized and she is now forced to take anti-clotting drugs daily.
She is suing J&J for damages to include all future medical expenses incurred in treating the condition.
Two days later, on October 19, 2006, the Parker & Waichman, LLP law firm announced that it had filed a lawsuit against the company in New Jersey on behalf of a 25-year-old Wisconsin women who was diagnosed with bilateral pulmonary emboli after 6 months of using the patch.
Parker & Waichman has already filed numerous patch related lawsuits and says it plans to file a "significant number" of additional cases by the end of 2006.
The lawsuit states that the injured victim in the case was taken to the emergency room on August 24, 2004, after experiencing lightheadedness, shortness of breath and chest pain, where diagnostic tests revealed bilateral pulmonary emboli.
According to the National Institute of Neurological Disorders and Stroke: (1) thrombosis is the formation of a clot within a blood vessel of the brain or neck; and (2) embolism is the movement of a clot from another part of the body to the neck or brain. Pulmonary embolism is a sudden blockage in a lung artery, usually due to a blood clot that traveled to the lung from the leg, but clots can also form in the pelvic vein.
After being diagnosed, the Wisconsin woman was hospitalized and received the drugs Heparin and Coumadin, as anticoagulant therapy, and according to the lawsuit, will need anticoagulant medication for a protracted period of time and possibly for the remainder of her life.
These new lawsuits, along with the hundreds of others already filed all over the country, allege that Ortho-McNeil was aware of the increased risks of blood clots, heart attack and stroke associated with the birth control patch even before the device was approved for use in the US, and that once approved, the company failed to adequately warn potential users about the risks.
To substantiate this claim in part, attorneys point to an internal Ortho-McNeil memo that shows that in 2003, the company refused to fund a study comparing the patch to its Ortho-Cyclen pill because of concerns that there was "too high a chance that study may not produce a positive result for Evra", and there was a "risk that Ortho Evra may be the same or worse than Ortho-Cyclen."
The plaintiff's attorney also list Ortho-McNeil's own records obtained and made public by CBS news, that show the company received some 500 reports of serious events associated with the patch between April 2002 and December 2004, during a time when only 61 such reports were received involving all types of birth control pills.
These records also show that there were 4 times as many strokes in women using the patch and that in medically confirmed cases, the risk of blood clots was found to be 14 times higher with the patch.
Users of the Ortho adhesive patch apply it to their body and change it once a week for three weeks and then do not wear it during the fourth week. The patch is intended to release 20 micrograms of estrogen into the bloodstream every 24 hours.
It is widely known that exposure to estrogen increases the risk of blood clots. The first FDA warning about the increased risks of blood clots with the patch was issued on November 10, 2005, and for the first time, Ortho-McNeil admitted that women who used the patch may be exposed to up to 60% more estrogen than women taking a birth control pill.
"FDA is announcing a revision to the label for the drug Ortho Evra," the agency said. "This change includes a new bolded warning about higher exposure to estrogen."
"Higher levels of estrogen," the FDA warned, "may put some women at increased risk for getting blood clots."
By the time of this warning, the FDA had received more than 9,000 reports of adverse events related to the patch in a 17-month period, while the Ortho Tri-Cyclen birth control pill, only generated a little over 1,200 adverse reports in a 6-year period.
In addition, during a 12-month period, 44 serious injuries or deaths were found to be associated with the patch, while only 17 such reports were found to be linked to the birth control pill during a similar time frame.
Critics say the drastic difference in serious events is further magnified when considering that the number of women using the Ortho Tri-Cyclen pill was 6 times the number of women using the Ortho Evra patch.
According to Jason Mark, an attorney at Parker & Waichman, LLP, who heads the firm's mass tort department, "The product needs to be withdrawn from the market so that it can no longer cause harm."
"The notion that periodic warnings of Ortho Evra's increased risks is sufficient," Mr Mark said in a press release, "to protect the health of women is misguided."
"There are many safer alternative forms of hormonal contraception than the patch," he states. "This is not a last resort, life saving medication."
On September 21, 2006, the law firm announced that it believes a new study that found women using the Ortho patch were twice as likely to develop blood clots compared with those using birth control pills provides further evidence that the patch is dangerous and should be recalled from the market.
As a result of this study, the firm noted, the FDA updated Ortho Evra's warning to reflect that women using the patch faced twice the risk of blood clots as women on the pill.
"The FDA also asked Ortho McNeil to conduct a longer study of the contraceptive patch to evaluate the risks of blood clots, heart attack and stroke," the Parker & Waichman press release stated.
According to its 2005 Annual Report, J&J sold $1.1 billion in contraceptives in 2005, but the report predicted a decline in sales for 2006 because of "labeling changes and negative media coverage concerning product safety."
Warnings to young women to stay away from the patch are growing in number. On September 29, 2006, the Editorial Board of the Exponent, a Purdue college newspaper, said women should use the birth control pill instead of the Ortho Evra birth control patch and also said the patch should be removed from the market.
The Exponent, published by the Purdue Student Publishing Foundation, is Indiana's largest collegiate daily newspaper and is primarily a student operation.
According to the Wall Street Journal, in providing health care services to 42,000 students, Pennsylvania State University is no longer writing prescriptions for the patch.
The Journal also reported that similar actions were being taken by health officials at other universities including Stanford, the University of Texas at Austin, the University of California, Berkeley, and the Connecticut College in New London.
Legal experts say the patch maker is scrambling to settle as many of these lawsuits as quickly and silently as possible with substantial monetary awards that come with the signing of confidential settlement agreements because it does not want to risk the public spectacle of a steady stream of young injured women parading before a jury.
"Ortho-McNeil Pharmaceutical," the April 9, 2006 New York Post reported "has settled a dozen lawsuits for millions of dollars in the last few months."
On May 2, 2006, a J&J attorney wrote a judge in New Jersey to say that 11 women who filed suit in that state had received settlements, although the amounts were kept confidential.
Also on May 2, 2006, a J&J attorney informed an Ohio judge that the company was prepared to settle all cases where the plaintiffs were hospitalized for pulmonary embolisms, deep vein thrombosis, heart attacks or strokes.
On May 16, 2006, the New Jersey Law Journal quoted a plaintiff's attorney who estimates that "many of these cases are seven figures, many are probably substantial six-figure cases."
However, settling these lawsuits as quickly as they are filed may not turn out to be so easy. Critics say there are likely to be tens of thousands more women spread out all over the country who do not yet realize that their health problems are caused by the patch.
Which may very well be true, because even though the FDA says it has received about 9,000 reports of adverse events related to the patch, the agency acknowledges that only between 1% and 10% of adverse events ever get reported and according to Bloomberg News on Mary 13, 2006, Johnson & Johnson has sold patches to 5 million women since the launch of the product in 2002.
Ortho Evra Birth Control Patch - Statistics do not Lie
Evelyn Pringle October 13, 2006
During one 17-month period between April 2002 and September 2003, the FDA received 9,116 adverse reaction reports on the Ortho Evra birth control patch.
In stark contrast, during a 6 year period between 1997 and September 2003, the Ortho birth control pill only generated 1,237 adverse event reports and 6 time more women were using the pill.
Since the FDA admits that it only receives adverse event reports on between 1% and 10% of the actual adverse events that occur, the death and injury rate for patch users is known to be many times higher than the numbers indicate in the FDA database.
Although patch maker, Ortho-McNeil Pharmaceutical, and its parent company, Johnson and Johnson, have continuously denied any knowledge about problems with the patch, according to CBS News, documents have surfaced in litigation that show the company's own records reveal that it received some 500 reports of serious problems associated with the patch between April 2002 and December 2004.
During the same time frame, CBS notes, there were only 61 adverse event reports received with respect to all types of oral contraceptives. In addition, there were four times as many strokes in women using the patch compared to women using oral contraceptives even though once again, there were three times more women taking the pill.
Finally, CBS said, the evidence indicates that in medically confirmed cases the risk of blood clots was 14 times higher with the patch.
The first lawsuit involving the patch filed in Texas in October 2004, on behalf of a woman who suffered a stoke and became paralyzed after wearing the patch for only 12 days, cited FDA records that revealed that in one year, between May 1, 2002 and April 30, 2003, forty-six women who were using the patch had suffered blood clot related death or injuries.
In the same time period, the lawsuit said, only half as many women on birth control pills had suffered clots even though here too, there were 6 times more women taking the pill. In addition, the lawsuit said, 11 times more fatal or life-threatening clots were developed in women on the patch when compared to those taking the pill.
Notwithstanding all of the above statistics gathered over 3 years, the FDA waited until November 11, 2005, to announce an addition to the patch label warning women who were using the patch that they were being exposed to 60% more estrogen than women on birth control pills. The FDA noted that exposure to higher levels of estrogen increased the risk of serious side effects. Adverse effects of estrogen use include blood clots in the legs or lungs as well as heart attack and stroke.
"In general," according to the Mayo Clinic, "the higher the amount of estrogen you're exposed to, the greater your risk of serious side effects."
Most recently, on September 20, 2006, the FDA announced an update to the Ortho Evra patch label based on the results of two epidemiology studies, both paid for by the patch maker, Johnson and Johnson, supposedly designed to evaluate the risk of serious side effects, specifically due to venous and arterial blood clots in women using patch.
Although both studies were conducted using electronic health care claims data, the two studies produced different results.
According to the FDA, the first study found that the risk of non-fatal venous thromboembolism (VTE) events associated with the use of the patch is similar to the risk associated with the use of oral contraceptive pills.
But the results of the second study, which included a review of patient charts, showed an approximate 2 fold increase in the risk of medically verified VTE events in users of the patch compared to women using of the pill.
The above statistics documenting the much larger number of cases of injury and death in women on the patch compared to the pill do not lie.
To begin with, by its own admission, J&J will not design a head-to-head clinical trial that might show the patch to be more dangerous than the pill. On July 18, 2005, the Associated Press, reported an internal company memo authored in 2003, that showed the company refused to fund a study comparing the Ortho patch to the company's Ortho-Cyclen pill because there was "too high a chance that study may not produce a positive result for Evra" and a "risk that Ortho Evra may be the same or worse than Ortho-Cyclen."
The Associated Press also reported that company documents showed that the drug maker itself had been analyzing the FDA's death and injury reports.
Critics say the FDA's latest warning is basically meaningless. "This announcement unfortunately is too little, too late for many women who relied on this dangerous product," says Attorney John David Hart of the Law Offices of John David Hart in Fort Worth, Texas, who is handling patch related lawsuits.
"While these new warnings are a step in the right direction," he says, "the simple truth is that a lot of women are hurt today because they were not fairly warned."
According to a press release by Attorney Hart, from April 2002 to December 2004, Johnson & Johnson in fact logged 27,974 adverse events among Ortho patch users, and during that same time period, the company recorded only 5,571 adverse events for one of its oral contraceptives, even though the pill was used by three times more women than were using the patch.
Other legal experts involved in patch litigation express the same sentiments. "The notion that periodic warnings of Ortho Evra's increased risks is sufficient to protect the health of women is misguided," says Jason Mark, an attorney at Parker & Waichman, LLP who heads the firm's mass tort litigation department.
"There are many safer alternative forms of hormonal contraception than the patch," he said in a press release. "This is not a last resort, life saving medication."
"The product needs to be withdrawn from the market," he says, "so that it can no longer cause harm."
The legal team for J&J is doing everything in its power to avoid jury trials in patch cases where experts predict the juries would rule for the plaintiffs and the truth about all the suppressed adverse event reports and other damaging information would become public.
Attorneys handling the patch cases say the cause of the injuries and deaths from the patch are more clear than those in other pharma cases. "You're dealing with primarily women ages 18 to 35 who don't have a lot of pre-existing conditions to begin with," a lawyer who is working with a South Carolina law firm on a dozen cases told Knight Ridder on May 12, 2006. "The reason why people are getting the blood clots," he said, "is a lot cleaner."
On April 9, 2006, the New York Post reported that women "who suffered life-threatening blood clots and strokes on the Ortho-Evra birth-control patch are receiving cash settlements from the manufacturer."
"Ortho-McNeil Pharmaceutical," the Post wrote, "has settled a dozen lawsuits for millions of dollars in the last few months."
On May 16, 2006, the New Jersey Law Journal reported that Johnson & Johnson had "adopted a quick-settlement strategy for a spate of suits charging that its Ortho Evra contraceptive patch causes blood clots due to heightened estrogen levels."
At a May 2, 2006 status conference with US District Judge David Katz in Cleveland, Ohio, where 73 cases from around the country have been consolidated, the Journal said, a J&J attorney announced that the company is prepared to settle all cases with plaintiffs who were hospitalized for stroke, heart attacks, pulmonary embolisms or deep vein thrombosis.
The same day, according to the Law Journal, J&J lawyer, Susan Sharko, wrote a letter to Superior Court Judge, Peter Bariso, in New Jersey informing him that the company had reached confidential settlements with 11 of the 12 plaintiffs who sued there.
On May 13, 2006, Bloomberg News reported that J&J had settled lawsuits with about 30 women quoting a lawyer who negotiated confidential agreements in the cases.
The tactical decision to settle cases as soon as they are filed should not be mistaken for a sign of an honest, kind, repentant drug maker. This tactic serves a much larger purpose. As long as J&J can settle cases with "confidential agreements," the plaintiffs will be legally bound to not speak about any patch related injuries and the documents from the litigation will be sealed by the court and the public will never learn the truth.
But the company had better start planning to go global to silence all the plaintiffs in the mounting cases because a class action lawsuit was filed in Canada on July 28, 2006, alleging the company failed to adequately warn Canadian patients and physicians that the patch was associated with an increased risk of developing blood clots, pulmonary emboli, strokes, heart attacks and deep vein thrombosis.
And the plaintiffs in this class action may not be so easily silenced. The attorney handling the case, Michael Peerless, a partner in the law firm Siskinds LLP, said by filing the lawsuit the company will be "required to explain to Canadian consumers what it knew about the risks associated with Ortho Evra and when it first became aware of those risks."
During one 17-month period between April 2002 and September 2003, the FDA received 9,116 adverse reaction reports on the Ortho Evra birth control patch.
In stark contrast, during a 6 year period between 1997 and September 2003, the Ortho birth control pill only generated 1,237 adverse event reports and 6 time more women were using the pill.
Since the FDA admits that it only receives adverse event reports on between 1% and 10% of the actual adverse events that occur, the death and injury rate for patch users is known to be many times higher than the numbers indicate in the FDA database.
Although patch maker, Ortho-McNeil Pharmaceutical, and its parent company, Johnson and Johnson, have continuously denied any knowledge about problems with the patch, according to CBS News, documents have surfaced in litigation that show the company's own records reveal that it received some 500 reports of serious problems associated with the patch between April 2002 and December 2004.
During the same time frame, CBS notes, there were only 61 adverse event reports received with respect to all types of oral contraceptives. In addition, there were four times as many strokes in women using the patch compared to women using oral contraceptives even though once again, there were three times more women taking the pill.
Finally, CBS said, the evidence indicates that in medically confirmed cases the risk of blood clots was 14 times higher with the patch.
The first lawsuit involving the patch filed in Texas in October 2004, on behalf of a woman who suffered a stoke and became paralyzed after wearing the patch for only 12 days, cited FDA records that revealed that in one year, between May 1, 2002 and April 30, 2003, forty-six women who were using the patch had suffered blood clot related death or injuries.
In the same time period, the lawsuit said, only half as many women on birth control pills had suffered clots even though here too, there were 6 times more women taking the pill. In addition, the lawsuit said, 11 times more fatal or life-threatening clots were developed in women on the patch when compared to those taking the pill.
Notwithstanding all of the above statistics gathered over 3 years, the FDA waited until November 11, 2005, to announce an addition to the patch label warning women who were using the patch that they were being exposed to 60% more estrogen than women on birth control pills. The FDA noted that exposure to higher levels of estrogen increased the risk of serious side effects. Adverse effects of estrogen use include blood clots in the legs or lungs as well as heart attack and stroke.
"In general," according to the Mayo Clinic, "the higher the amount of estrogen you're exposed to, the greater your risk of serious side effects."
Most recently, on September 20, 2006, the FDA announced an update to the Ortho Evra patch label based on the results of two epidemiology studies, both paid for by the patch maker, Johnson and Johnson, supposedly designed to evaluate the risk of serious side effects, specifically due to venous and arterial blood clots in women using patch.
Although both studies were conducted using electronic health care claims data, the two studies produced different results.
According to the FDA, the first study found that the risk of non-fatal venous thromboembolism (VTE) events associated with the use of the patch is similar to the risk associated with the use of oral contraceptive pills.
But the results of the second study, which included a review of patient charts, showed an approximate 2 fold increase in the risk of medically verified VTE events in users of the patch compared to women using of the pill.
The above statistics documenting the much larger number of cases of injury and death in women on the patch compared to the pill do not lie.
To begin with, by its own admission, J&J will not design a head-to-head clinical trial that might show the patch to be more dangerous than the pill. On July 18, 2005, the Associated Press, reported an internal company memo authored in 2003, that showed the company refused to fund a study comparing the Ortho patch to the company's Ortho-Cyclen pill because there was "too high a chance that study may not produce a positive result for Evra" and a "risk that Ortho Evra may be the same or worse than Ortho-Cyclen."
The Associated Press also reported that company documents showed that the drug maker itself had been analyzing the FDA's death and injury reports.
Critics say the FDA's latest warning is basically meaningless. "This announcement unfortunately is too little, too late for many women who relied on this dangerous product," says Attorney John David Hart of the Law Offices of John David Hart in Fort Worth, Texas, who is handling patch related lawsuits.
"While these new warnings are a step in the right direction," he says, "the simple truth is that a lot of women are hurt today because they were not fairly warned."
According to a press release by Attorney Hart, from April 2002 to December 2004, Johnson & Johnson in fact logged 27,974 adverse events among Ortho patch users, and during that same time period, the company recorded only 5,571 adverse events for one of its oral contraceptives, even though the pill was used by three times more women than were using the patch.
Other legal experts involved in patch litigation express the same sentiments. "The notion that periodic warnings of Ortho Evra's increased risks is sufficient to protect the health of women is misguided," says Jason Mark, an attorney at Parker & Waichman, LLP who heads the firm's mass tort litigation department.
"There are many safer alternative forms of hormonal contraception than the patch," he said in a press release. "This is not a last resort, life saving medication."
"The product needs to be withdrawn from the market," he says, "so that it can no longer cause harm."
The legal team for J&J is doing everything in its power to avoid jury trials in patch cases where experts predict the juries would rule for the plaintiffs and the truth about all the suppressed adverse event reports and other damaging information would become public.
Attorneys handling the patch cases say the cause of the injuries and deaths from the patch are more clear than those in other pharma cases. "You're dealing with primarily women ages 18 to 35 who don't have a lot of pre-existing conditions to begin with," a lawyer who is working with a South Carolina law firm on a dozen cases told Knight Ridder on May 12, 2006. "The reason why people are getting the blood clots," he said, "is a lot cleaner."
On April 9, 2006, the New York Post reported that women "who suffered life-threatening blood clots and strokes on the Ortho-Evra birth-control patch are receiving cash settlements from the manufacturer."
"Ortho-McNeil Pharmaceutical," the Post wrote, "has settled a dozen lawsuits for millions of dollars in the last few months."
On May 16, 2006, the New Jersey Law Journal reported that Johnson & Johnson had "adopted a quick-settlement strategy for a spate of suits charging that its Ortho Evra contraceptive patch causes blood clots due to heightened estrogen levels."
At a May 2, 2006 status conference with US District Judge David Katz in Cleveland, Ohio, where 73 cases from around the country have been consolidated, the Journal said, a J&J attorney announced that the company is prepared to settle all cases with plaintiffs who were hospitalized for stroke, heart attacks, pulmonary embolisms or deep vein thrombosis.
The same day, according to the Law Journal, J&J lawyer, Susan Sharko, wrote a letter to Superior Court Judge, Peter Bariso, in New Jersey informing him that the company had reached confidential settlements with 11 of the 12 plaintiffs who sued there.
On May 13, 2006, Bloomberg News reported that J&J had settled lawsuits with about 30 women quoting a lawyer who negotiated confidential agreements in the cases.
The tactical decision to settle cases as soon as they are filed should not be mistaken for a sign of an honest, kind, repentant drug maker. This tactic serves a much larger purpose. As long as J&J can settle cases with "confidential agreements," the plaintiffs will be legally bound to not speak about any patch related injuries and the documents from the litigation will be sealed by the court and the public will never learn the truth.
But the company had better start planning to go global to silence all the plaintiffs in the mounting cases because a class action lawsuit was filed in Canada on July 28, 2006, alleging the company failed to adequately warn Canadian patients and physicians that the patch was associated with an increased risk of developing blood clots, pulmonary emboli, strokes, heart attacks and deep vein thrombosis.
And the plaintiffs in this class action may not be so easily silenced. The attorney handling the case, Michael Peerless, a partner in the law firm Siskinds LLP, said by filing the lawsuit the company will be "required to explain to Canadian consumers what it knew about the risks associated with Ortho Evra and when it first became aware of those risks."
Thursday, August 5, 2010
Merck Insurance Carriers Jump Ship Over Vioxx Disaster
Evelyn Pringle September 15, 2006
According to Merck's August 7, 2006, SEC filing, "At this time, the Company believes that its insurance coverage with respect to the Vioxx Lawsuits will not be adequate to cover its defense costs and any losses."
In addition, Merck says it has not established any reserves for potential liability relating to the Vioxx lawsuits or investigations, including for those cases in which a verdict has been entered against the company, and are now in post-verdict proceedings or on appeal.
According to the filing, Merck has product liability insurance for claims brought in the Vioxx Product Liability Lawsuits with upper limits of about $630 million after deductibles and co-insurance. This insurance provides coverage for legal defense costs and potential damage amounts that have been or will be incurred in connection with the Vioxx Product Liability Lawsuits.
The company says it has Directors and Officers insurance coverage applicable to the Vioxx Securities Lawsuits and Vioxx Derivative Lawsuits with stated upper limits of about $190 million and fiduciary and other insurance for the Vioxx ERISA Lawsuits with stated upper limits of approximately $275 million.
However, the filing states, the amounts actually recovered under the policies may be less than the amounts specified. It seem there are now disputes with certain insurers about the availability of some or all of this coverage and there are likely to be more disputes, according to Merck.
In fact, the company's upper level excess insurers, which provide excess insurance potentially applicable to all Vioxx lawsuits, have commenced an arbitration seeking to cancel those policies, to void all obligations under those policies, and to raise other coverage issues with respect to Vioxx lawsuits.
But not to worry. "Merck intends to contest vigorously the insurers' claims and will attempt to enforce its rights under applicable insurance policies," the filings says.
For its part, as of December 31, 2004, Merck had established a reserve of $675 million solely for its future legal defense costs related to Vioxx. During 2005, according to the SEC filing, the company spent $285 million in legal defense costs related to Vioxx (i) Product Liability Lawsuits, (ii) Shareholder Lawsuits, (iii) Foreign Lawsuits, and (iv) Investigations.
In the fourth quarter of 2005, Merck recorded a charge of $295 million to increase the reserve for Vioxx legal defense costs to $685 million at December 31, 2005.
"Unfavorable outcomes in the Vioxx Litigation," the SEC filing concludes, "could have a material adverse effect on the Company's financial position, liquidity and results of operations."
Being insurers are fighting against payment of damages before even one case is settled, it does not take a financial genius to figure out that Merck is in for big trouble.
According to the SEC filing, as of June 30, 2006, Merck has been served or is aware that it has been named as a defendant in approximately 14,200 lawsuits, which include approximately 27,100 plaintiff groups, alleging personal injuries resulting from the use of Vioxx.
Of these cases, Merck says, approximately 5,700 lawsuits representing approximately 16,100 plaintiff groups are or are slated to be in the federal Multidistrict Litigation (MDL), and approximately 7,100 lawsuit representing approximately 7,100 plaintiff groups are included in a coordinated proceeding in New Jersey Superior Court before Judge Carol Higbee.
These lawsuits include allegations related to cardiovascular events, thrombotic events, gastrointestinal bleeding or kidney damage.
Merck has also been named as a defendant in close to 200 putative class actions alleging personal injuries or seeking (1) medical monitoring due to class members' use of Vioxx , (2) disgorgement of profits under unjust enrichment theories, and (3) remedies under state consumer fraud and fair business practice statutes, including recovery for the cost of Vioxx purchased by individuals and third-party payors such as union health plans.
The lawsuits filed in the state courts of New Jersey, California, Texas, and Pennsylvania, have all been transferred to a single judge in each state for coordinated proceedings.
On February 16, 2005, the Judicial Panel on Multidistrict Litigation transferred all Vioxx Product Liability Lawsuits in federal courts nationwide into one MDL for coordinated pre-trial proceedings in the US District Court for the Eastern District of Louisiana before Judge Eldon Fallon.
Judge Fallon has informed the litigants that he intends to try a series of cases through 2006, in the following Vioxx categories: (1) heart attack with short term use; (2) heart attack with long term use; (3) stroke; and (4) cardiovascular injury after April 2002 when the labeling on Vioxx was changed to include the results of the VIGOR trial.
Legal experts say Merck took a major hit on July 29, 2005, when a New Jersey state court certified a nationwide class of third-party payors, such as unions and health insurance plans, who paid for Vioxx used by their plan members. The named plaintiff seeks recovery of purchase costs, plus penalties, based on allegations that the class members paid more for Vioxx than they would have had they known the drug's alleged risks.
Merck appealed the ruling and on March 31, 2006, the New Jersey Superior Court, Appellate Division, affirmed the class certification. The New Jersey Supreme Court recently decided to exercise its discretion to hear the appeal of the appellate court decision.
The trial in this case is currently scheduled to begin in March 2007, and according to Merck, it is not known whether the Supreme Court's decision will affect the trial date.
Merck has also been named as a defendant in separate lawsuits brought by the Attorneys General of Alaska, Louisiana, Mississippi, Montana, Texas, and Utah, that claim Merck misrepresented the safety of Vioxx and seek reimbursement for (1) the cost of Vioxx purchased or reimbursed by the state; (2) all sums paid by the state for treatment of persons injured by Vioxx; (3) damages under various common law theories; and (4) remedies under various state statutory theories, including state consumer fraud, fair business practices, or Medicaid fraud, including civil penalties.
Even if the insurance carries end up covering the Vioxx cases, critics say how far is one or two billion dollars worth of insurance tops, going to go when there are states like Texas seeking $168 million in damages and additional civil penalties. Texas Attorney General, Greg Abbott, says he can prove total damages in excess of $250 million including treble reimbursement of $56 million, or $168 million, for five years of Vioxx prescriptions purchased in Texas.
In addition to the product liability lawsuits, Merck and various current and former officers and directors are named defendants in various putative class actions and individual lawsuits filed under the federal securities laws, all of which have been transferred to the US District Court for the District of New Jersey before Judge Stanley Chesler for inclusion in a nationwide shareholder MDL.
The plaintiffs request certification of a class of purchasers of Merck stock between May 21,1999 and October 29, 2004, and allege that the defendants made false and misleading statements regarding Vioxx in violation of the Securities Exchange Act of 1934, and seek unspecified compensatory damages and the costs of lawsuit, including attorneys' fees.
The complaint also asserts a claim against certain defendants relating to their sale of Merck stock and includes allegations that certain defendants made incomplete and misleading statements in a registration statement and certain prospectuses filed in connection with the Merck Stock Investment Plan, a dividend reinvestment plan.
The Merck defendants have filed a motion to dismiss the complaint which was still pending at the time of the SEC filing on August 7, 2006.
On August 15, 2005, a lawsuit was filed in Oregon state court under Oregon securities law, by the State of Oregon on behalf of the Oregon Public Employee Retirement Fund against Merck and certain current and former officers and directors alleging damages in connection with its purchases of Merck common stock at artificially inflated prices due to Merck's violations of law related to disclosures about Vioxx .
On July 19, 2006, the Court denied a motion by Merck to dismiss Oregon's complaint and according to Merck's SEC filing, the current and former officers and directors have entered into a tolling agreement in exchange for plaintiffs' dismissal, without prejudice, of the claims against them.
Various federal shareholder derivative actions have been transferred to the Shareholder MDL and consolidated for all purposes by Judge Chesler. The consolidated complaint arises out of the same factual allegations that are made in the other Vioxx securities lawsuits.
The derivative suits assert claims against certain members of the Board past and present, and certain executive officers, for breach of fiduciary duty, waste of corporate assets, unjust enrichment, abuse of control and gross mismanagement.
On May 5, 2006, Judge Chesler granted a motion by defendants to dismiss the complaint and denied plaintiffs' request for leave to amend their complaint, and plaintiffs have appealed to the US Court of Appeals for the Third Circuit.
On October 29, 2004, according to the SEC filing, two shareholders made a demand on the Board to take legal action against former Chairman, President and CEO, Raymond Gilmartin, and other individuals for causing damage to the company with respect to the improper marketing of Vioxx .
In response to the shareholder's demand letter, the Board determined at its November 23, 2004 meeting that the Board would take the request under consideration and it remains under consideration.
The Board, the SEC filing states, has recently received another shareholder letter demanding that the Board take legal action against the Board and Merck management for causing damage to the company relating to the company's improper marketing of Vioxx.
In addition, various federal putative class actions filed against Merck and certain current and former officers and directors have been transferred to the Shareholder MDL and consolidated for all purposes. The consolidated complaint asserts claims on behalf of certain current and former employees who are participants in Merck's retirement plans for breach of fiduciary duty under the Employee Retirement Income Security Act.
The allegations are similar to those contained in the other securities lawsuits. On October 7, 2005, defendants moved to dismiss the complaint, and on July 11, 2006, Judge Chesler granted in part and denied in part the motion to dismiss.
The court dismissed the claim of breach of fiduciary duty based on continued investment in Merck stock as to all defendants except the 5 individuals who were members of Merck's Management Pension Investment Committee during the purported class period.
The court dismissed the claim for breach of fiduciary duty based on failure to provide complete or accurate information to participants to the extent it related to specific communications cited in the complaint, but declined to dismiss the claim before discovery to the extent plaintiffs allege that adverse information was withheld from participants.
The court also dismissed the claim for failure to monitor as to all defendants except the members of the Compensation and Benefits Committee of Merck's Board of Directors who had supervisory responsibility for the MPIC.
Finally, the court declined to dismiss the claim for co-fiduciary liability, absent factual development, but dismissed as duplicative the claim for knowing participation in breach of fiduciary duty.
As far as a slow down in the continuous stream of lawsuits, Merck is no doubt hoping to see a light at the end of the tunnel soon because Vioxx was pulled off the market on September 30, 2004, and some states have a 2-year statute of limitations requiring that lawsuits must be filed within two years after the plaintiffs learned or could have learned of their potential cause of action.
As a result, experts say September 30, 2006 is a deadline for filing Vioxx cases in many states. However, they also note that the laws governing statutes of limitations are complex, can vary from state to state, and might be affected by pending class actions. For instance, some states have 3-year statutes of limitations, and some even longer.
Legal analysts predict there will be arguments raised about the proper application of these statutes, but say ultimately the decisions will be up to the federal and state judges presiding over the individual cases.
But then Merck attorneys know that September definitely will not be the end date for filing Vioxx lawsuits because according to Merck's SEC filing, as of June 30, 2006, the company has entered into agreements with about 5,800 plaintiffs to toll the statute of limitations, so the September 30, 2006 cut-off date would not apply in those cases.
The tolling agreement with the MDL Plaintiffs' Steering Committee establishes a procedure to halt the running of the statute of limitations as to certain categories of claims arising from the use of Vioxx by non-New Jersey citizens.
The agreement applies to individuals who have not yet filed lawsuits and only to those claimants alleging injuries resulting from a thrombotic cardiovascular event that results in a myocardial infarction or ischemic stroke. The agreement requires any tolled claims to be filed in federal court.
And although its never mentioned much, Merck has been named as a defendant in litigation relating to Vioxx all over the globe including several countries in Europe as well as Canada, Australia, Brazil, Turkey, and Israel.
In addition, based on media reports and other sources, Merck says, it anticipates that additional Vioxx Product Liability Lawsuits, Vioxx Shareholder Lawsuits and Vioxx Foreign Lawsuits will be filed against it and certain current and former officers and directors in the future.
And that may be true, because critics says there should be another shareholder lawsuit filed against Merck Management this month for flushing another $21 million in profits down the toilet by paying a committee to publish a bogus 1,700 page report to supposedly absolve Merck Management of any wrongdoing.
But in any event, Merck's legal woes are not limited to civil court proceedings. In November 2004, Merck was advised by the SEC that it was commencing an informal inquiry concerning Vioxx, and on January 28, 2005, Merck announced that it received notice that the SEC issued a formal notice of investigation.
Also, according to the company's SEC filing, Merck has received subpoenas from the US Department of Justice requesting information related to the research, marketing and selling activities of Vioxx in a federal health care investigation under criminal statutes.
Merck also says it has received a number of Civil Investigative Demands from a group of Attorneys General from 31 states and the District of Columbia who are investigating whether Merck violated state consumer protection laws when marketing Vioxx.
And finally, to end on a happy note, the SEC filing says, investigations are being conducted by local authorities in certain cities in Europe in order to determine whether any criminal charges should be filed related to Vioxx.
"The Company," Merck states, "cannot predict the outcome of these inquiries; however, they could result in potential civil and/or criminal dispositions."
According to Merck's August 7, 2006, SEC filing, "At this time, the Company believes that its insurance coverage with respect to the Vioxx Lawsuits will not be adequate to cover its defense costs and any losses."
In addition, Merck says it has not established any reserves for potential liability relating to the Vioxx lawsuits or investigations, including for those cases in which a verdict has been entered against the company, and are now in post-verdict proceedings or on appeal.
According to the filing, Merck has product liability insurance for claims brought in the Vioxx Product Liability Lawsuits with upper limits of about $630 million after deductibles and co-insurance. This insurance provides coverage for legal defense costs and potential damage amounts that have been or will be incurred in connection with the Vioxx Product Liability Lawsuits.
The company says it has Directors and Officers insurance coverage applicable to the Vioxx Securities Lawsuits and Vioxx Derivative Lawsuits with stated upper limits of about $190 million and fiduciary and other insurance for the Vioxx ERISA Lawsuits with stated upper limits of approximately $275 million.
However, the filing states, the amounts actually recovered under the policies may be less than the amounts specified. It seem there are now disputes with certain insurers about the availability of some or all of this coverage and there are likely to be more disputes, according to Merck.
In fact, the company's upper level excess insurers, which provide excess insurance potentially applicable to all Vioxx lawsuits, have commenced an arbitration seeking to cancel those policies, to void all obligations under those policies, and to raise other coverage issues with respect to Vioxx lawsuits.
But not to worry. "Merck intends to contest vigorously the insurers' claims and will attempt to enforce its rights under applicable insurance policies," the filings says.
For its part, as of December 31, 2004, Merck had established a reserve of $675 million solely for its future legal defense costs related to Vioxx. During 2005, according to the SEC filing, the company spent $285 million in legal defense costs related to Vioxx (i) Product Liability Lawsuits, (ii) Shareholder Lawsuits, (iii) Foreign Lawsuits, and (iv) Investigations.
In the fourth quarter of 2005, Merck recorded a charge of $295 million to increase the reserve for Vioxx legal defense costs to $685 million at December 31, 2005.
"Unfavorable outcomes in the Vioxx Litigation," the SEC filing concludes, "could have a material adverse effect on the Company's financial position, liquidity and results of operations."
Being insurers are fighting against payment of damages before even one case is settled, it does not take a financial genius to figure out that Merck is in for big trouble.
According to the SEC filing, as of June 30, 2006, Merck has been served or is aware that it has been named as a defendant in approximately 14,200 lawsuits, which include approximately 27,100 plaintiff groups, alleging personal injuries resulting from the use of Vioxx.
Of these cases, Merck says, approximately 5,700 lawsuits representing approximately 16,100 plaintiff groups are or are slated to be in the federal Multidistrict Litigation (MDL), and approximately 7,100 lawsuit representing approximately 7,100 plaintiff groups are included in a coordinated proceeding in New Jersey Superior Court before Judge Carol Higbee.
These lawsuits include allegations related to cardiovascular events, thrombotic events, gastrointestinal bleeding or kidney damage.
Merck has also been named as a defendant in close to 200 putative class actions alleging personal injuries or seeking (1) medical monitoring due to class members' use of Vioxx , (2) disgorgement of profits under unjust enrichment theories, and (3) remedies under state consumer fraud and fair business practice statutes, including recovery for the cost of Vioxx purchased by individuals and third-party payors such as union health plans.
The lawsuits filed in the state courts of New Jersey, California, Texas, and Pennsylvania, have all been transferred to a single judge in each state for coordinated proceedings.
On February 16, 2005, the Judicial Panel on Multidistrict Litigation transferred all Vioxx Product Liability Lawsuits in federal courts nationwide into one MDL for coordinated pre-trial proceedings in the US District Court for the Eastern District of Louisiana before Judge Eldon Fallon.
Judge Fallon has informed the litigants that he intends to try a series of cases through 2006, in the following Vioxx categories: (1) heart attack with short term use; (2) heart attack with long term use; (3) stroke; and (4) cardiovascular injury after April 2002 when the labeling on Vioxx was changed to include the results of the VIGOR trial.
Legal experts say Merck took a major hit on July 29, 2005, when a New Jersey state court certified a nationwide class of third-party payors, such as unions and health insurance plans, who paid for Vioxx used by their plan members. The named plaintiff seeks recovery of purchase costs, plus penalties, based on allegations that the class members paid more for Vioxx than they would have had they known the drug's alleged risks.
Merck appealed the ruling and on March 31, 2006, the New Jersey Superior Court, Appellate Division, affirmed the class certification. The New Jersey Supreme Court recently decided to exercise its discretion to hear the appeal of the appellate court decision.
The trial in this case is currently scheduled to begin in March 2007, and according to Merck, it is not known whether the Supreme Court's decision will affect the trial date.
Merck has also been named as a defendant in separate lawsuits brought by the Attorneys General of Alaska, Louisiana, Mississippi, Montana, Texas, and Utah, that claim Merck misrepresented the safety of Vioxx and seek reimbursement for (1) the cost of Vioxx purchased or reimbursed by the state; (2) all sums paid by the state for treatment of persons injured by Vioxx; (3) damages under various common law theories; and (4) remedies under various state statutory theories, including state consumer fraud, fair business practices, or Medicaid fraud, including civil penalties.
Even if the insurance carries end up covering the Vioxx cases, critics say how far is one or two billion dollars worth of insurance tops, going to go when there are states like Texas seeking $168 million in damages and additional civil penalties. Texas Attorney General, Greg Abbott, says he can prove total damages in excess of $250 million including treble reimbursement of $56 million, or $168 million, for five years of Vioxx prescriptions purchased in Texas.
In addition to the product liability lawsuits, Merck and various current and former officers and directors are named defendants in various putative class actions and individual lawsuits filed under the federal securities laws, all of which have been transferred to the US District Court for the District of New Jersey before Judge Stanley Chesler for inclusion in a nationwide shareholder MDL.
The plaintiffs request certification of a class of purchasers of Merck stock between May 21,1999 and October 29, 2004, and allege that the defendants made false and misleading statements regarding Vioxx in violation of the Securities Exchange Act of 1934, and seek unspecified compensatory damages and the costs of lawsuit, including attorneys' fees.
The complaint also asserts a claim against certain defendants relating to their sale of Merck stock and includes allegations that certain defendants made incomplete and misleading statements in a registration statement and certain prospectuses filed in connection with the Merck Stock Investment Plan, a dividend reinvestment plan.
The Merck defendants have filed a motion to dismiss the complaint which was still pending at the time of the SEC filing on August 7, 2006.
On August 15, 2005, a lawsuit was filed in Oregon state court under Oregon securities law, by the State of Oregon on behalf of the Oregon Public Employee Retirement Fund against Merck and certain current and former officers and directors alleging damages in connection with its purchases of Merck common stock at artificially inflated prices due to Merck's violations of law related to disclosures about Vioxx .
On July 19, 2006, the Court denied a motion by Merck to dismiss Oregon's complaint and according to Merck's SEC filing, the current and former officers and directors have entered into a tolling agreement in exchange for plaintiffs' dismissal, without prejudice, of the claims against them.
Various federal shareholder derivative actions have been transferred to the Shareholder MDL and consolidated for all purposes by Judge Chesler. The consolidated complaint arises out of the same factual allegations that are made in the other Vioxx securities lawsuits.
The derivative suits assert claims against certain members of the Board past and present, and certain executive officers, for breach of fiduciary duty, waste of corporate assets, unjust enrichment, abuse of control and gross mismanagement.
On May 5, 2006, Judge Chesler granted a motion by defendants to dismiss the complaint and denied plaintiffs' request for leave to amend their complaint, and plaintiffs have appealed to the US Court of Appeals for the Third Circuit.
On October 29, 2004, according to the SEC filing, two shareholders made a demand on the Board to take legal action against former Chairman, President and CEO, Raymond Gilmartin, and other individuals for causing damage to the company with respect to the improper marketing of Vioxx .
In response to the shareholder's demand letter, the Board determined at its November 23, 2004 meeting that the Board would take the request under consideration and it remains under consideration.
The Board, the SEC filing states, has recently received another shareholder letter demanding that the Board take legal action against the Board and Merck management for causing damage to the company relating to the company's improper marketing of Vioxx.
In addition, various federal putative class actions filed against Merck and certain current and former officers and directors have been transferred to the Shareholder MDL and consolidated for all purposes. The consolidated complaint asserts claims on behalf of certain current and former employees who are participants in Merck's retirement plans for breach of fiduciary duty under the Employee Retirement Income Security Act.
The allegations are similar to those contained in the other securities lawsuits. On October 7, 2005, defendants moved to dismiss the complaint, and on July 11, 2006, Judge Chesler granted in part and denied in part the motion to dismiss.
The court dismissed the claim of breach of fiduciary duty based on continued investment in Merck stock as to all defendants except the 5 individuals who were members of Merck's Management Pension Investment Committee during the purported class period.
The court dismissed the claim for breach of fiduciary duty based on failure to provide complete or accurate information to participants to the extent it related to specific communications cited in the complaint, but declined to dismiss the claim before discovery to the extent plaintiffs allege that adverse information was withheld from participants.
The court also dismissed the claim for failure to monitor as to all defendants except the members of the Compensation and Benefits Committee of Merck's Board of Directors who had supervisory responsibility for the MPIC.
Finally, the court declined to dismiss the claim for co-fiduciary liability, absent factual development, but dismissed as duplicative the claim for knowing participation in breach of fiduciary duty.
As far as a slow down in the continuous stream of lawsuits, Merck is no doubt hoping to see a light at the end of the tunnel soon because Vioxx was pulled off the market on September 30, 2004, and some states have a 2-year statute of limitations requiring that lawsuits must be filed within two years after the plaintiffs learned or could have learned of their potential cause of action.
As a result, experts say September 30, 2006 is a deadline for filing Vioxx cases in many states. However, they also note that the laws governing statutes of limitations are complex, can vary from state to state, and might be affected by pending class actions. For instance, some states have 3-year statutes of limitations, and some even longer.
Legal analysts predict there will be arguments raised about the proper application of these statutes, but say ultimately the decisions will be up to the federal and state judges presiding over the individual cases.
But then Merck attorneys know that September definitely will not be the end date for filing Vioxx lawsuits because according to Merck's SEC filing, as of June 30, 2006, the company has entered into agreements with about 5,800 plaintiffs to toll the statute of limitations, so the September 30, 2006 cut-off date would not apply in those cases.
The tolling agreement with the MDL Plaintiffs' Steering Committee establishes a procedure to halt the running of the statute of limitations as to certain categories of claims arising from the use of Vioxx by non-New Jersey citizens.
The agreement applies to individuals who have not yet filed lawsuits and only to those claimants alleging injuries resulting from a thrombotic cardiovascular event that results in a myocardial infarction or ischemic stroke. The agreement requires any tolled claims to be filed in federal court.
And although its never mentioned much, Merck has been named as a defendant in litigation relating to Vioxx all over the globe including several countries in Europe as well as Canada, Australia, Brazil, Turkey, and Israel.
In addition, based on media reports and other sources, Merck says, it anticipates that additional Vioxx Product Liability Lawsuits, Vioxx Shareholder Lawsuits and Vioxx Foreign Lawsuits will be filed against it and certain current and former officers and directors in the future.
And that may be true, because critics says there should be another shareholder lawsuit filed against Merck Management this month for flushing another $21 million in profits down the toilet by paying a committee to publish a bogus 1,700 page report to supposedly absolve Merck Management of any wrongdoing.
But in any event, Merck's legal woes are not limited to civil court proceedings. In November 2004, Merck was advised by the SEC that it was commencing an informal inquiry concerning Vioxx, and on January 28, 2005, Merck announced that it received notice that the SEC issued a formal notice of investigation.
Also, according to the company's SEC filing, Merck has received subpoenas from the US Department of Justice requesting information related to the research, marketing and selling activities of Vioxx in a federal health care investigation under criminal statutes.
Merck also says it has received a number of Civil Investigative Demands from a group of Attorneys General from 31 states and the District of Columbia who are investigating whether Merck violated state consumer protection laws when marketing Vioxx.
And finally, to end on a happy note, the SEC filing says, investigations are being conducted by local authorities in certain cities in Europe in order to determine whether any criminal charges should be filed related to Vioxx.
"The Company," Merck states, "cannot predict the outcome of these inquiries; however, they could result in potential civil and/or criminal dispositions."
Merck Not Losing Sleep Over Vioxx Disaster
Evelyn Pringle June 16, 2006
Merck's top management team reportedly remains unphased by Vioxx litigation woes. In fact, Prudential Equity Group analyst, Timothy Anderson, says Merck's Chief Executive, Richard Clark, specifically told him that "Vioxx does not keep him up at night."
According to Mr Anderson, "the company believes that lower court cases will be overturned on appeal, and it is even considering trying to reintroduce Vioxx."
"A reintroduction might help Merck's legal case," Mr Anderson states, "as long as the FDA or its advisers do not decide that Merck's risks really do outweigh its benefits," he said in a June 21, 2006, article in Forbes.com."
Critics say that's not even a remote possibility because the FDA is still under fire for its own part in the Vioxx disaster and it wouldn't dare pull a stunt like that.
When it comes to saving Merck in the Vioxx litigation, the FDA is at odds with some of the most powerful leaders in Congress. Senator Charles Grassley (R-Iowa), chairman of the Senate Finance Committee, is on record as saying the Vioxx debacle has shown that the FDA has gotten too cozy with drug companies to conduct proper oversight.
"The Vioxx example showed that the FDA and Merck were too close for comfort," he said in a speech. "Testimony and documents at our Finance Committee hearing showed that the FDA allowed itself to be manipulated by Merck."
Documents indeed reveal that the FDA knew about the problems with Vioxx very early on. A memo written by Shari Targum, MD, Project Manager for the Division of Anti-inflammatory Drug Products, clearly shows that as of November 18, 1999, the Data and Safety Monitoring Board of the VIGOR study, a committee independent from Merck, was concerned over the deaths from cardiovascular events in the Vioxx group, compared to the group taking another painkiller.
This memo documents a clear date of recognition by the FDA of when cardiovascular events were brought to the attention of Merck.
Admittedly, if it was up to the Bush administration, the FDA would allow Vioxx back on the market today. Bush does everything in his power to protect the profits of Big Pharma, the industry most responsible for his 8-year rent free lease of the White House.
Under Bush, the FDA has in fact become Big Pharma's chief enabler when it comes to getting away with murder. A newly released report on June 26, 2006, titled, "Prescription for Harm: The Decline in FDA Enforcement Activity," says that FDA enforcement actions have declined by 50% since Bush took office.
"The number of warning letters issued by the agency for violations of federal requirements," the report said, "has fallen by over 50%, from 1,154 in 2000 to 535 in 2005, a 15-year low."
"During the same period," it noted, "the number of seizures of mislabeled, defective, and dangerous products has declined by 44%."
Bush has never hesitated to utilize the FDA in the Big Pharma protection racket. For instance, on January 18, 2006, the FDA issued new regulations for labeling prescription drugs, supposedly aimed at providing doctors and patients with clearer information about their risks. But in the preamble to the regulations, the FDA inserted a claim that lawsuits alleging a failure to warn of known or reasonably knowable risks are preempted by federal law.
Also, amicus briefs filed by FDA attorneys appointed by Bush, on behalf of the drug companies, have tried to claim that because private lawsuits threaten to disrupt the nation's system of drug regulation, federal standards preempt requirements established by state judges and lawmakers, and that if a state court finds that a drug is unsafe, it is in direct conflict with the conclusion reached by the FDA.
With Bush using the FDA to do the dirty work, Republicans lawmakers up for reelection this fall, don't have to make a spectacle of themselves fighting for such blatant industry-friendly legislation during an election year.
A partner in the LA based Baum Hedlund law firm, attorney Karen Barth Menzies, has been litigating claims against drug companies for more than a decade and says "the Vioxx public health debacle has served to highlight deep-seeded problems within the FDA."
"Drug companies are profit-driven," she explains, "and are loath to issue warnings about risks associated with their drugs, even those that become quite clear."
"Medicine is no longer about health," Ms Menzies notes, "its about market share and profits."
Since Bush took office, the FDA has sent out its legal squad to assert the preemption argument on behalf of drug companies in attempt to defeat private citizens in lawsuits numerous times. However, Ms Menzies' team of Baum Hedlund attorneys has knocked the FDA briefs out of the ball park in a several cases, including Witczak v Pfizer and Motus v Pfizer.
But "the FDA's legal arm has continued to intervene in private civil lawsuits on the side of drug companies," she says, "arguing that FDA's decisions should not be second-guessed by anyone, the federal preemption argument."
In the past 15 plus years, Ms Menzies notes, the FDA has been worse than "comatose" as the New York Times recently described the agency. "It has sided with industry and become an adversary against consumers," she points out.
"And it is precisely for this reason," she says, "that the public is in such desperate need for an agency that advocates for them, rather than the drug industry."
In light of recent disasters like Vioxx that have resulted in large part due to a lack of regulatory oversight, Ms Menzies contends that the "FDA's decisions must be second-guessed for the safety of the public."
Medical experts agree that the FDA must be second-guessed. "With an FDA that regularly displays incompetence and negligence in its deliberations about the efficacy and safety of medications," says Dr Grace Jackson, author of, Rethinking Psychiatric Drugs: A Guide to Informed Consent, "it cannot possibly be the case that this federal agency possesses the institutional expertise to which courts or litigants should now defer."
"Indeed," she notes, "if the FDA is preempting anything, it is the sound practice of medicine, and the integrity of American health care."
It will truly be a fatal day for the concept of separation of powers when a federal agency like the FDA can wield the power to enact federal law by filing legal briefs in private lawsuits, funded by tax dollars, to defeat American citizens who are already up against one of the most profitable industries on earth.
Moreover, if FDA attorneys are going waste tax dollars, the least they can to is come up with a few valid arguments. The argument that drug companies are not allowed to warn the public by adding a new warning to a label when dangers become known because it would violate FDA regulations, is ridiculous. There is not now, and there has never been, a law that prevents a drug maker from strengthening a warning or labeling consistent with the company's specific regulatory ability to do so under 21 CFR 314.70(c)(6)(iii)(A).
The guy responsible for this silly argument is the FDA's Chief Counsel, Daniel Troy, recruited straight off of Pfizer's legal team, was Big Pharma's inside man until he quit the FDA in the fall of 2004.
Instead of going after the drug companies for killing off citizens with lethal drugs in the name of profits, he devoted much of his time filing Joe Tax Payer funded briefs, on behalf of his former industry clients, and even invited drug company attorneys to submit their cases to him for amicus brief consideration.
On March 1, 2004, Jessica Rae Dart, an attorney involved in civil litigation against Pfizer, filed an affidavit in support of a plaintiff's motion and described a lecture she attended by Mr Troy that clearly shows him offering the FDA's services to trial lawyers representing drug companies.
On December 15, 2003, Ms Dart said, Daniel Troy, Chief Counsel of the FDA, headed a discussion for pharmaceutical firms and defense attorneys titled, "The Case for Preemption" at the 8th Annual Conference for the In house Counsel and Trial Attorneys, Drug and Medical Device Litigation" in New York City.
During Troy's "Case for Preemption" talk, she said, Troy stated that he was the initiator behind all the FDA Amicus Briefs and/or Statement of Interest filed on behalf of manufacturers "since the new administration" took over. Specifically, he stated, "I am not the only one who decides," but "I am the initial proposer."
According to the affidavit, Troy made it clear that he wanted to file more amicus briefs on behalf of the drug companies and actually invited members of the defense attorney's audience to approach him with requests for briefs, stating "we can't afford to get involved in every case," we have to "pick out shots," so "make it sound like a Hollywood pitch."
However, in an obvious effort to try and level the playing field for the little guy, in 2004, Representative, Maurice Hinchey (D-NY), chastised the administration for taking the FDA in a radical new direction, "seeking to protect drug companies instead of the public," and persuaded the House to cut $500,000 from the budget of the chief counsel's office as a penalty for the FDA's aggressive opposition to citizen's lawsuits.
Although the FDA's current Chief Counsel, Sheldon Bradshaw, might not have the direct and visible financial links to Big Pharma of his predecessor, critics say, he certainly does not represent a changing-of-the-guard in political leadership at the FDA.
"In fact," Attorney Menzies says, "following in his predecessor's footsteps, Bradshaw submitted a legal brief in support of Pfizer's federal preemption arguments."
Judges across the nation have flat-out rejected the FDA's argument. A Minnesota court said it declined "to treat statements from a single FDA legal brief as declarations afforded the preemptive force of law."
A California court ordered the brief stricken from the record calling it "hearsay and irrelevant," and an Illinois judge said it "contains nothing more than legal argument by [FDA] counsel."
Most recently, in a June 6, 2005, Vioxx court hearing, the FDA's position on preemption hit a major road block with New Jersey State Court Judge, Carol Higbee, who is handling the Vioxx cases, when she labeled the FDA's Final Rule's preamble "a political statement by the FDA." She scoffed at the agency's preemption claim and said:
"It is contrary to the U.S. Supreme Court's decisions. It is contrary to all the law on preemption. ... In addition to being contrary to the law of the land, it is also contrary to the Constitution of the United States."
Judge Higbee ended her comments by throwing cold water on any planned attempt by Merck's legal team to give the preemption argument a whirl, by telling them right-out in open court: "I am not going to allow you to use it."
Speaking to the Consumer Federation of America in March 2005, Senator Grassley, basically said the FDA can't be trusted to protect citizens against dangerous drugs like Vioxx because the agency is to "cozy" with companies like Merck.
Based on a clinical trial that took place in 2000, he told the audience, both the FDA and Merck were aware that heart attacks were 5 times more likely in patients taking Vioxx than among those taking a similar drug, but the FDA did nothing to change the labeling on the drug for nearly two years, while Merck aggressively marketed Vioxx on nightly TV.
Describing whistleblowers as "patriots" who risk their careers in the interest of public safety, Senator Grassley recounted the controversy over Vioxx that was fueled in large part by the efforts of FDA scientist, Dr David Graham, to shed light on the drug's potential risks.
Senator Grassley described how the FDA "disregarded and stonewalled" concerns raised by its own scientist. "Dr. Graham completed a study that found an increased risk of heart attacks and strokes in patients taking Vioxx," he told the Federation. "His immediate supervisor, however, dismissed this study as 'scientific rumor.'"
"The very same month that Dr. Graham warned the FDA of the cardiovascular risks of Vioxx," Senator Grassley continued, "the FDA approved the use of Vioxx for children."
He told the audience how the director of FDA's office of new drugs suggested that Dr. Graham water down his Vioxx conclusions and how Dr Graham replied that in good conscience he could not. "When Dr. Graham was asked to present his findings at my committee's Vioxx hearing," the Senator said, "he was also undermined."
News reports that day show that acting FDA Commissioner Lester Crawford called Dr Graham a "maverick who did not follow agency protocols."
"This statement," Senator Grassley told the Federation, "made on the eve of the hearing, could logically serve no purpose other than to intimidate Dr. Graham."
The Vioxx matter became the focus of the Senate Finance Committee, basically because of the drug's cost to public health care programs, and the Committee is responsible for oversight of the Medicaid and Medicare programs.
During a November 18, 2004, hearing, the ranking Democrat on the finance committee, Senator Max Baucus, discussed the tax dollars wasted on Vioxx: "In the 5 years that Vioxx was on the market, Medicaid spent more than $1 billion on the drug," he said.
In addition, he complained about the fact that government programs are now paying the medical bills for patients harmed by Vioxx. "Medicaid bears the cost of any additional medical care necessary when drugs cause injury," Senator Baucus said.
Merck's last CEO, Raymond Gilmartin, resigned on May 5, 2005, the same day that another Congressional Committee, the House Committee on Government Reform, released more than 20,000 pages of documents showing how Merck continued to promote Vioxx long after it was aware of the safety problems.
Documents released that day at a Reform Committee hearing on Merck's marketing practices, described in detail how Merck directed its 3,000-strong sales force to avoid discussions about the cardiovascular risks identified in the 2000 VIGOR study. During visits with doctors, sales reps were instructed to rely on a "Cardiovascular Card" that claimed Vioxx was actually protecting the heart rather than damaging it. The sales reps were specifically trained on how to speak, smile, and position themselves most effectively when talking to doctors.
If doctors asked about Vioxx increasing the risk, the sales reps were instructed to give them a pamphlet written by Merck's marketing department that claimed Vioxx was eight times safer for heart patients than similar pain medications, and omitted Merck's findings that Vioxx produced a 5-fold increase in the risk of heart attack and stroke compared with naproxen, the other painkiller used in the study.
The company's training efforts were obviously successful because Vioxx was approved by the FDA in May 1999, and the drug reached $2 billion in sales in two years, faster than any drug in Merck's history.
In 2000, the same year the VIGOR study was completed, Vioxx was the most heavily advertised drug in the US with $160.8 million spent on mass media promotion. And the blitz paid off well. In one year, retail sales of Vioxx rose from $329.5 million in 1999, to $1.5 billion in 2000, up 360%, according to a November 2001, report by the National Institute for Health Care Management.
For the same year, Pepsi only spent $125 million advertising its products. Vioxx also beat out Budweiser's spending of $146 million, and matched Dell Computer's ad expenditures of $160 million. And by far, the drug beat out Nike's advertising budget of $78.2 million for shoes, and Campbell soup's $58 million.
The increase in Vioxx sales from 1999 to 2000 accounted for 5.7% of the one-year increase in total prescription drug spending, more than any other single drug, the report said, and Vioxx was the 13th best selling drug in 2000.
In 2003, Merck upped the anti even more and spent 499.8 million on Vioxx promotion including the cost of sales reps detailing office and hospital-based physicians, advertising in medical journals and the retail value of samples passed out to doctors, according to IMS Health, Integrated Promotional Services in April, 2004. In return Vioxx saw growth of 24% and became the 6th best selling drug.
What's that old saying about the bigger they are the harder they fall?
Nowadays, instead of spending hundreds of millions of dollars promoting Vioxx, shareholders are paying hundreds of millions a year for attorney fees. As of December 31, 2004, in its 2005 annual report, Merck said it had a reserve of $675 million solely for its future legal defense costs related to Vioxx. And in the fourth quarter of 2005, Merck said it recorded another charge of $295 million to increase the reserve.
"This reserve is based on certain assumptions," the annual report said, "and is the best estimate of the amount that the Company believes, at this time, it can reasonably estimate will be spent through 2007."
There is no money listed anywhere in Merck's financial filings set aside to pay damages to any injured party, at least through 2007. The whole wad goes for Vioxx "legal defense costs."
And to think, Republicans have the nerve to say that personal injury attorneys who go up against attorneys with a war chest of close to $700 million a year are financial gluttons.
However, thanks to a helpful group of plaintiff's attorneys, going up against Merck in jury trials is getting bit easier. The group put together what they call a pre-made Vioxx trial package, complete with a guide to pursuing a claim against the corporate giant.
The package reportedly organizes and edits all of the information that shows Merck knew about the dangers of Vioxx but failed to inform consumers and includes the most damaging documents and evidence available against the drug maker. The package is offered on a small contingency fee basis and costs nothing until the lawsuit is won.
This month, Merck's legal eagles were hit up once again when the New England Journal of Medicine issued a correction to a paper it published last year on Vioxx that mistakenly said that heart risks only became apparent after 18 months. The Journal editors deleted the 18 month statements saying a statistical error by Merck undermined the evidence for them.
All through litigation thus far, Merck's main argument has been that the risk to patients from Vioxx did not begin until after 18 months of use, and with one sweep of the pen, the NEJM blew a hole in that defense.
But then juries are not buying into the 18 month defense in any event. In the first jury trial, in August 2005, the jury held Merck liable for the death of Vioxx victim, Robert Ernst, age 59, who died after only taking Vioxx for eight months.
Internal company documents introduced at the trial showed that Merck was aware of the problems with Vioxx as early as 1997. Attorney, Mark Lanier, showed jurors documents and e-mails to prove that Merck scientists knew about the cardiovascular risks (CVs), two years before the drug was approved.
For instance, one 1997 email written by Merck scientist Dr Alise Reicin, said: "The possibility of increased C.V. events is of great concern."
"I just can't wait to be the one to present those results to senior management," he wrote.
As evidence to prove that physicians were deliberately misled, the jury was shown a 2001 Dear Doctor letter, in which Merck specifically stated that in the largest study ever of more than 4000 patients taking Vioxx, only 0.5%, or about 20 patients, had incurred CVs, when in fact, 14.6% of the patients, or 590, had cardiovascular problems, according to a Merck report submitted to the FDA.
It was also proven at trial that in April 2001, the doctor who prescribed Vioxx to Mr Ernst, had received the letter with the fraudulent statistics.
Mr Lanier played a video for the jury that showed sales reps were told that Vioxx did not increase heart attacks and were trained to view doctors concerns about CVs as "obstacles" to be avoided or dismissed. Another training document told sales reps to play "Dodgeball" if doctors raised questions about CVs.
In a more recent on-going trial, on July 5, 2006, more damaging testimony against Merck was given by Dr Lemuel Moye, a professor of biostatistics at the University of Texas, in a California case filed by a 71-year-old, Stewart Grossberg, who told the jury that Merck's clinical trials conducted as far back as 1996, showed patients taking Vioxx were at risk for heart attacks and strokes, long before the drug went on the market, and that after reviewing the trials, he concluded that Vioxx carried more risks to patients than benefits.
But legal experts say that back in April 2006, Merck received the worst news possible when it lost an appeal to deny certification of a Vioxx-related class action lawsuit. They says the court's decision to certify third-party payers, like health insurance companies, HMOs, and unions, has to be the most disturbing development for the company to date.
By ruling against Merck, the court gave the OK to apply New Jersey's consumer fraud statutes to all members of the class, even to plaintiffs from states that have different laws. Experts predict that the consequences of this ruling will be profound and far-reaching, and the costs to Merck potentially staggering.
In light of the verdict in the April 2006, trial of Cona v Merck and McDarby v Merck, in which the jury said Merck violated New Jersey's consumer fraud statute because it misled physicians about the cardiovascular risks of Vioxx and concealed information about those risks from doctors, experts say, the appeals court's ruling might just turn out to be the nail in the coffin for Merck.
Christopher Seeger, the lead lawyer in the class action filed by HMOs, insurers, and unions, says that Judge Higbee, who is overseeing about 5,000 Vioxx cases, should apply the findings of this jury to the class action, which he said could be worth $10 billion.
Mr Seeger told Bloomberg News on April 5, 2006, that this was devastating for Merck: "This jury just said 'Yes' to consumer fraud, so I think we go right to damages."
Mr Seeger is referring to collateral estoppel a situation in which the judgment in one case prevents, or estops, a party from litigating the same issue in future cases. Because of the consumer fraud verdict, Mr Seeger contends that Merck may now be permanently bound by the jury's ruling.
Indeed, Bloomberg says, a judge could decide that the ruling that Merck failed to warn of Vioxx's risks could be applied to thousands of future trials in New Jersey, leaving the jury to decide only whether Vioxx caused specific heart attacks.
Barry Turner is an academic lawyer in the UK who has taught medical ethics and for a number of years has been involved in litigation activities related to the pharmaceutical industry.
He has been advocating the use of federal and state false claims statutes against Big Pharma for years. "I take the view that because of the harsh penalties imposed when these actions are successful," he explains, "that this is the legal strategy that will work against these people."
"PI suits," he says, "may very well be morally righteous but they will never make this industry change its ways."
"What is at issue," he continues, "is that companies factor litigation costs into 'research and development' and other costs of sales, so it does not hurt them to pay out in damages, what they already budgeted for."
"The Federal and State False Claims Act actions are different," he notes, "a drug company hit by a big one of these will have to pay out colossal amounts in fines and damages, hundreds of millions in most cases," he says, "and these come out of profits."
"Then the stock will go down," he explains, "and they can be hit again under the Sarbanes Oxley Act."
"And if anyone thinks that Sarbanes Oxley is feeble legislation," he says, "they can always ask the Enron executives."
"As well as defrauding the taxpayer," Mr Turners notes, "the consequences of these deliberate and deceitful acts hurts shareholders when the litigation causes serious downturns in stock value."
"This is a violation of Sarbanes Oxley," he says, "and sooner of later there will be a major action here."
In each of the cases Merck has lost, the juries have ordered the drug giant to pay large punitive damage awards, creating additional problems for the company. Punitive damages are awarded to punish a defendant and deter future misconduct. They are not covered by insurance because the conduct is an intentional act on the part of the insured; and the intent of punitive damages would be lost if a defendant could avoid payment simply by buying more insurance.
In the state of New Jersey, punitive damages are allowed to be as much as 5 times the amount of compensatory damages. The Texas $229 million punitive damage award against Merck, even when reduced, will still be about $26 million. Legal analysts say no company could avoid financial ruin if ordered to pay tens of thousands of $26 million punitive damage awards.
Punitive damages provide a basis for a derivative lawsuit seeking damages for conduct that compromised the value of the investments of shareholders. These types of lawsuits are being filed for much less than what Merck pulled with Vioxx.
For instance, in March 2005, a class action lawsuit was filed in the US District Court for the District of Massachusetts, on behalf of shareholders in Elan Corp PLC, after the company's withdrawal of the multiple sclerosis drug Tysabri, with many of the same allegations that can be made against Merck.
The complaint alleges that Elan failed to disclose and misrepresented material adverse facts in connection with Tysabri including serious immune-system side effects and that the information was concealed in order to fast track Tysabri for FDA approval.
In any event, notwithstanding that Merck continues to contend that it will try every single case, legal analysts say, state courts will never be able to handle the trials for the lawsuits already filed, much less the additional cases still being filed on a regular basis.
"At some point courts are going to be clogged with these cases and judges will start to put pressure on Merck and the plaintiffs to settle these cases," according to John Leubsdorf, professor of law at Rutgers Law School, on CNN Moneyline on April 26, 2006.
"The only scenario in which they won't settle," he says, "is if they win so much that all the plaintiffs go away."
But experts say that is definitely not going to happen.
Merck's top management team reportedly remains unphased by Vioxx litigation woes. In fact, Prudential Equity Group analyst, Timothy Anderson, says Merck's Chief Executive, Richard Clark, specifically told him that "Vioxx does not keep him up at night."
According to Mr Anderson, "the company believes that lower court cases will be overturned on appeal, and it is even considering trying to reintroduce Vioxx."
"A reintroduction might help Merck's legal case," Mr Anderson states, "as long as the FDA or its advisers do not decide that Merck's risks really do outweigh its benefits," he said in a June 21, 2006, article in Forbes.com."
Critics say that's not even a remote possibility because the FDA is still under fire for its own part in the Vioxx disaster and it wouldn't dare pull a stunt like that.
When it comes to saving Merck in the Vioxx litigation, the FDA is at odds with some of the most powerful leaders in Congress. Senator Charles Grassley (R-Iowa), chairman of the Senate Finance Committee, is on record as saying the Vioxx debacle has shown that the FDA has gotten too cozy with drug companies to conduct proper oversight.
"The Vioxx example showed that the FDA and Merck were too close for comfort," he said in a speech. "Testimony and documents at our Finance Committee hearing showed that the FDA allowed itself to be manipulated by Merck."
Documents indeed reveal that the FDA knew about the problems with Vioxx very early on. A memo written by Shari Targum, MD, Project Manager for the Division of Anti-inflammatory Drug Products, clearly shows that as of November 18, 1999, the Data and Safety Monitoring Board of the VIGOR study, a committee independent from Merck, was concerned over the deaths from cardiovascular events in the Vioxx group, compared to the group taking another painkiller.
This memo documents a clear date of recognition by the FDA of when cardiovascular events were brought to the attention of Merck.
Admittedly, if it was up to the Bush administration, the FDA would allow Vioxx back on the market today. Bush does everything in his power to protect the profits of Big Pharma, the industry most responsible for his 8-year rent free lease of the White House.
Under Bush, the FDA has in fact become Big Pharma's chief enabler when it comes to getting away with murder. A newly released report on June 26, 2006, titled, "Prescription for Harm: The Decline in FDA Enforcement Activity," says that FDA enforcement actions have declined by 50% since Bush took office.
"The number of warning letters issued by the agency for violations of federal requirements," the report said, "has fallen by over 50%, from 1,154 in 2000 to 535 in 2005, a 15-year low."
"During the same period," it noted, "the number of seizures of mislabeled, defective, and dangerous products has declined by 44%."
Bush has never hesitated to utilize the FDA in the Big Pharma protection racket. For instance, on January 18, 2006, the FDA issued new regulations for labeling prescription drugs, supposedly aimed at providing doctors and patients with clearer information about their risks. But in the preamble to the regulations, the FDA inserted a claim that lawsuits alleging a failure to warn of known or reasonably knowable risks are preempted by federal law.
Also, amicus briefs filed by FDA attorneys appointed by Bush, on behalf of the drug companies, have tried to claim that because private lawsuits threaten to disrupt the nation's system of drug regulation, federal standards preempt requirements established by state judges and lawmakers, and that if a state court finds that a drug is unsafe, it is in direct conflict with the conclusion reached by the FDA.
With Bush using the FDA to do the dirty work, Republicans lawmakers up for reelection this fall, don't have to make a spectacle of themselves fighting for such blatant industry-friendly legislation during an election year.
A partner in the LA based Baum Hedlund law firm, attorney Karen Barth Menzies, has been litigating claims against drug companies for more than a decade and says "the Vioxx public health debacle has served to highlight deep-seeded problems within the FDA."
"Drug companies are profit-driven," she explains, "and are loath to issue warnings about risks associated with their drugs, even those that become quite clear."
"Medicine is no longer about health," Ms Menzies notes, "its about market share and profits."
Since Bush took office, the FDA has sent out its legal squad to assert the preemption argument on behalf of drug companies in attempt to defeat private citizens in lawsuits numerous times. However, Ms Menzies' team of Baum Hedlund attorneys has knocked the FDA briefs out of the ball park in a several cases, including Witczak v Pfizer and Motus v Pfizer.
But "the FDA's legal arm has continued to intervene in private civil lawsuits on the side of drug companies," she says, "arguing that FDA's decisions should not be second-guessed by anyone, the federal preemption argument."
In the past 15 plus years, Ms Menzies notes, the FDA has been worse than "comatose" as the New York Times recently described the agency. "It has sided with industry and become an adversary against consumers," she points out.
"And it is precisely for this reason," she says, "that the public is in such desperate need for an agency that advocates for them, rather than the drug industry."
In light of recent disasters like Vioxx that have resulted in large part due to a lack of regulatory oversight, Ms Menzies contends that the "FDA's decisions must be second-guessed for the safety of the public."
Medical experts agree that the FDA must be second-guessed. "With an FDA that regularly displays incompetence and negligence in its deliberations about the efficacy and safety of medications," says Dr Grace Jackson, author of, Rethinking Psychiatric Drugs: A Guide to Informed Consent, "it cannot possibly be the case that this federal agency possesses the institutional expertise to which courts or litigants should now defer."
"Indeed," she notes, "if the FDA is preempting anything, it is the sound practice of medicine, and the integrity of American health care."
It will truly be a fatal day for the concept of separation of powers when a federal agency like the FDA can wield the power to enact federal law by filing legal briefs in private lawsuits, funded by tax dollars, to defeat American citizens who are already up against one of the most profitable industries on earth.
Moreover, if FDA attorneys are going waste tax dollars, the least they can to is come up with a few valid arguments. The argument that drug companies are not allowed to warn the public by adding a new warning to a label when dangers become known because it would violate FDA regulations, is ridiculous. There is not now, and there has never been, a law that prevents a drug maker from strengthening a warning or labeling consistent with the company's specific regulatory ability to do so under 21 CFR 314.70(c)(6)(iii)(A).
The guy responsible for this silly argument is the FDA's Chief Counsel, Daniel Troy, recruited straight off of Pfizer's legal team, was Big Pharma's inside man until he quit the FDA in the fall of 2004.
Instead of going after the drug companies for killing off citizens with lethal drugs in the name of profits, he devoted much of his time filing Joe Tax Payer funded briefs, on behalf of his former industry clients, and even invited drug company attorneys to submit their cases to him for amicus brief consideration.
On March 1, 2004, Jessica Rae Dart, an attorney involved in civil litigation against Pfizer, filed an affidavit in support of a plaintiff's motion and described a lecture she attended by Mr Troy that clearly shows him offering the FDA's services to trial lawyers representing drug companies.
On December 15, 2003, Ms Dart said, Daniel Troy, Chief Counsel of the FDA, headed a discussion for pharmaceutical firms and defense attorneys titled, "The Case for Preemption" at the 8th Annual Conference for the In house Counsel and Trial Attorneys, Drug and Medical Device Litigation" in New York City.
During Troy's "Case for Preemption" talk, she said, Troy stated that he was the initiator behind all the FDA Amicus Briefs and/or Statement of Interest filed on behalf of manufacturers "since the new administration" took over. Specifically, he stated, "I am not the only one who decides," but "I am the initial proposer."
According to the affidavit, Troy made it clear that he wanted to file more amicus briefs on behalf of the drug companies and actually invited members of the defense attorney's audience to approach him with requests for briefs, stating "we can't afford to get involved in every case," we have to "pick out shots," so "make it sound like a Hollywood pitch."
However, in an obvious effort to try and level the playing field for the little guy, in 2004, Representative, Maurice Hinchey (D-NY), chastised the administration for taking the FDA in a radical new direction, "seeking to protect drug companies instead of the public," and persuaded the House to cut $500,000 from the budget of the chief counsel's office as a penalty for the FDA's aggressive opposition to citizen's lawsuits.
Although the FDA's current Chief Counsel, Sheldon Bradshaw, might not have the direct and visible financial links to Big Pharma of his predecessor, critics say, he certainly does not represent a changing-of-the-guard in political leadership at the FDA.
"In fact," Attorney Menzies says, "following in his predecessor's footsteps, Bradshaw submitted a legal brief in support of Pfizer's federal preemption arguments."
Judges across the nation have flat-out rejected the FDA's argument. A Minnesota court said it declined "to treat statements from a single FDA legal brief as declarations afforded the preemptive force of law."
A California court ordered the brief stricken from the record calling it "hearsay and irrelevant," and an Illinois judge said it "contains nothing more than legal argument by [FDA] counsel."
Most recently, in a June 6, 2005, Vioxx court hearing, the FDA's position on preemption hit a major road block with New Jersey State Court Judge, Carol Higbee, who is handling the Vioxx cases, when she labeled the FDA's Final Rule's preamble "a political statement by the FDA." She scoffed at the agency's preemption claim and said:
"It is contrary to the U.S. Supreme Court's decisions. It is contrary to all the law on preemption. ... In addition to being contrary to the law of the land, it is also contrary to the Constitution of the United States."
Judge Higbee ended her comments by throwing cold water on any planned attempt by Merck's legal team to give the preemption argument a whirl, by telling them right-out in open court: "I am not going to allow you to use it."
Speaking to the Consumer Federation of America in March 2005, Senator Grassley, basically said the FDA can't be trusted to protect citizens against dangerous drugs like Vioxx because the agency is to "cozy" with companies like Merck.
Based on a clinical trial that took place in 2000, he told the audience, both the FDA and Merck were aware that heart attacks were 5 times more likely in patients taking Vioxx than among those taking a similar drug, but the FDA did nothing to change the labeling on the drug for nearly two years, while Merck aggressively marketed Vioxx on nightly TV.
Describing whistleblowers as "patriots" who risk their careers in the interest of public safety, Senator Grassley recounted the controversy over Vioxx that was fueled in large part by the efforts of FDA scientist, Dr David Graham, to shed light on the drug's potential risks.
Senator Grassley described how the FDA "disregarded and stonewalled" concerns raised by its own scientist. "Dr. Graham completed a study that found an increased risk of heart attacks and strokes in patients taking Vioxx," he told the Federation. "His immediate supervisor, however, dismissed this study as 'scientific rumor.'"
"The very same month that Dr. Graham warned the FDA of the cardiovascular risks of Vioxx," Senator Grassley continued, "the FDA approved the use of Vioxx for children."
He told the audience how the director of FDA's office of new drugs suggested that Dr. Graham water down his Vioxx conclusions and how Dr Graham replied that in good conscience he could not. "When Dr. Graham was asked to present his findings at my committee's Vioxx hearing," the Senator said, "he was also undermined."
News reports that day show that acting FDA Commissioner Lester Crawford called Dr Graham a "maverick who did not follow agency protocols."
"This statement," Senator Grassley told the Federation, "made on the eve of the hearing, could logically serve no purpose other than to intimidate Dr. Graham."
The Vioxx matter became the focus of the Senate Finance Committee, basically because of the drug's cost to public health care programs, and the Committee is responsible for oversight of the Medicaid and Medicare programs.
During a November 18, 2004, hearing, the ranking Democrat on the finance committee, Senator Max Baucus, discussed the tax dollars wasted on Vioxx: "In the 5 years that Vioxx was on the market, Medicaid spent more than $1 billion on the drug," he said.
In addition, he complained about the fact that government programs are now paying the medical bills for patients harmed by Vioxx. "Medicaid bears the cost of any additional medical care necessary when drugs cause injury," Senator Baucus said.
Merck's last CEO, Raymond Gilmartin, resigned on May 5, 2005, the same day that another Congressional Committee, the House Committee on Government Reform, released more than 20,000 pages of documents showing how Merck continued to promote Vioxx long after it was aware of the safety problems.
Documents released that day at a Reform Committee hearing on Merck's marketing practices, described in detail how Merck directed its 3,000-strong sales force to avoid discussions about the cardiovascular risks identified in the 2000 VIGOR study. During visits with doctors, sales reps were instructed to rely on a "Cardiovascular Card" that claimed Vioxx was actually protecting the heart rather than damaging it. The sales reps were specifically trained on how to speak, smile, and position themselves most effectively when talking to doctors.
If doctors asked about Vioxx increasing the risk, the sales reps were instructed to give them a pamphlet written by Merck's marketing department that claimed Vioxx was eight times safer for heart patients than similar pain medications, and omitted Merck's findings that Vioxx produced a 5-fold increase in the risk of heart attack and stroke compared with naproxen, the other painkiller used in the study.
The company's training efforts were obviously successful because Vioxx was approved by the FDA in May 1999, and the drug reached $2 billion in sales in two years, faster than any drug in Merck's history.
In 2000, the same year the VIGOR study was completed, Vioxx was the most heavily advertised drug in the US with $160.8 million spent on mass media promotion. And the blitz paid off well. In one year, retail sales of Vioxx rose from $329.5 million in 1999, to $1.5 billion in 2000, up 360%, according to a November 2001, report by the National Institute for Health Care Management.
For the same year, Pepsi only spent $125 million advertising its products. Vioxx also beat out Budweiser's spending of $146 million, and matched Dell Computer's ad expenditures of $160 million. And by far, the drug beat out Nike's advertising budget of $78.2 million for shoes, and Campbell soup's $58 million.
The increase in Vioxx sales from 1999 to 2000 accounted for 5.7% of the one-year increase in total prescription drug spending, more than any other single drug, the report said, and Vioxx was the 13th best selling drug in 2000.
In 2003, Merck upped the anti even more and spent 499.8 million on Vioxx promotion including the cost of sales reps detailing office and hospital-based physicians, advertising in medical journals and the retail value of samples passed out to doctors, according to IMS Health, Integrated Promotional Services in April, 2004. In return Vioxx saw growth of 24% and became the 6th best selling drug.
What's that old saying about the bigger they are the harder they fall?
Nowadays, instead of spending hundreds of millions of dollars promoting Vioxx, shareholders are paying hundreds of millions a year for attorney fees. As of December 31, 2004, in its 2005 annual report, Merck said it had a reserve of $675 million solely for its future legal defense costs related to Vioxx. And in the fourth quarter of 2005, Merck said it recorded another charge of $295 million to increase the reserve.
"This reserve is based on certain assumptions," the annual report said, "and is the best estimate of the amount that the Company believes, at this time, it can reasonably estimate will be spent through 2007."
There is no money listed anywhere in Merck's financial filings set aside to pay damages to any injured party, at least through 2007. The whole wad goes for Vioxx "legal defense costs."
And to think, Republicans have the nerve to say that personal injury attorneys who go up against attorneys with a war chest of close to $700 million a year are financial gluttons.
However, thanks to a helpful group of plaintiff's attorneys, going up against Merck in jury trials is getting bit easier. The group put together what they call a pre-made Vioxx trial package, complete with a guide to pursuing a claim against the corporate giant.
The package reportedly organizes and edits all of the information that shows Merck knew about the dangers of Vioxx but failed to inform consumers and includes the most damaging documents and evidence available against the drug maker. The package is offered on a small contingency fee basis and costs nothing until the lawsuit is won.
This month, Merck's legal eagles were hit up once again when the New England Journal of Medicine issued a correction to a paper it published last year on Vioxx that mistakenly said that heart risks only became apparent after 18 months. The Journal editors deleted the 18 month statements saying a statistical error by Merck undermined the evidence for them.
All through litigation thus far, Merck's main argument has been that the risk to patients from Vioxx did not begin until after 18 months of use, and with one sweep of the pen, the NEJM blew a hole in that defense.
But then juries are not buying into the 18 month defense in any event. In the first jury trial, in August 2005, the jury held Merck liable for the death of Vioxx victim, Robert Ernst, age 59, who died after only taking Vioxx for eight months.
Internal company documents introduced at the trial showed that Merck was aware of the problems with Vioxx as early as 1997. Attorney, Mark Lanier, showed jurors documents and e-mails to prove that Merck scientists knew about the cardiovascular risks (CVs), two years before the drug was approved.
For instance, one 1997 email written by Merck scientist Dr Alise Reicin, said: "The possibility of increased C.V. events is of great concern."
"I just can't wait to be the one to present those results to senior management," he wrote.
As evidence to prove that physicians were deliberately misled, the jury was shown a 2001 Dear Doctor letter, in which Merck specifically stated that in the largest study ever of more than 4000 patients taking Vioxx, only 0.5%, or about 20 patients, had incurred CVs, when in fact, 14.6% of the patients, or 590, had cardiovascular problems, according to a Merck report submitted to the FDA.
It was also proven at trial that in April 2001, the doctor who prescribed Vioxx to Mr Ernst, had received the letter with the fraudulent statistics.
Mr Lanier played a video for the jury that showed sales reps were told that Vioxx did not increase heart attacks and were trained to view doctors concerns about CVs as "obstacles" to be avoided or dismissed. Another training document told sales reps to play "Dodgeball" if doctors raised questions about CVs.
In a more recent on-going trial, on July 5, 2006, more damaging testimony against Merck was given by Dr Lemuel Moye, a professor of biostatistics at the University of Texas, in a California case filed by a 71-year-old, Stewart Grossberg, who told the jury that Merck's clinical trials conducted as far back as 1996, showed patients taking Vioxx were at risk for heart attacks and strokes, long before the drug went on the market, and that after reviewing the trials, he concluded that Vioxx carried more risks to patients than benefits.
But legal experts say that back in April 2006, Merck received the worst news possible when it lost an appeal to deny certification of a Vioxx-related class action lawsuit. They says the court's decision to certify third-party payers, like health insurance companies, HMOs, and unions, has to be the most disturbing development for the company to date.
By ruling against Merck, the court gave the OK to apply New Jersey's consumer fraud statutes to all members of the class, even to plaintiffs from states that have different laws. Experts predict that the consequences of this ruling will be profound and far-reaching, and the costs to Merck potentially staggering.
In light of the verdict in the April 2006, trial of Cona v Merck and McDarby v Merck, in which the jury said Merck violated New Jersey's consumer fraud statute because it misled physicians about the cardiovascular risks of Vioxx and concealed information about those risks from doctors, experts say, the appeals court's ruling might just turn out to be the nail in the coffin for Merck.
Christopher Seeger, the lead lawyer in the class action filed by HMOs, insurers, and unions, says that Judge Higbee, who is overseeing about 5,000 Vioxx cases, should apply the findings of this jury to the class action, which he said could be worth $10 billion.
Mr Seeger told Bloomberg News on April 5, 2006, that this was devastating for Merck: "This jury just said 'Yes' to consumer fraud, so I think we go right to damages."
Mr Seeger is referring to collateral estoppel a situation in which the judgment in one case prevents, or estops, a party from litigating the same issue in future cases. Because of the consumer fraud verdict, Mr Seeger contends that Merck may now be permanently bound by the jury's ruling.
Indeed, Bloomberg says, a judge could decide that the ruling that Merck failed to warn of Vioxx's risks could be applied to thousands of future trials in New Jersey, leaving the jury to decide only whether Vioxx caused specific heart attacks.
Barry Turner is an academic lawyer in the UK who has taught medical ethics and for a number of years has been involved in litigation activities related to the pharmaceutical industry.
He has been advocating the use of federal and state false claims statutes against Big Pharma for years. "I take the view that because of the harsh penalties imposed when these actions are successful," he explains, "that this is the legal strategy that will work against these people."
"PI suits," he says, "may very well be morally righteous but they will never make this industry change its ways."
"What is at issue," he continues, "is that companies factor litigation costs into 'research and development' and other costs of sales, so it does not hurt them to pay out in damages, what they already budgeted for."
"The Federal and State False Claims Act actions are different," he notes, "a drug company hit by a big one of these will have to pay out colossal amounts in fines and damages, hundreds of millions in most cases," he says, "and these come out of profits."
"Then the stock will go down," he explains, "and they can be hit again under the Sarbanes Oxley Act."
"And if anyone thinks that Sarbanes Oxley is feeble legislation," he says, "they can always ask the Enron executives."
"As well as defrauding the taxpayer," Mr Turners notes, "the consequences of these deliberate and deceitful acts hurts shareholders when the litigation causes serious downturns in stock value."
"This is a violation of Sarbanes Oxley," he says, "and sooner of later there will be a major action here."
In each of the cases Merck has lost, the juries have ordered the drug giant to pay large punitive damage awards, creating additional problems for the company. Punitive damages are awarded to punish a defendant and deter future misconduct. They are not covered by insurance because the conduct is an intentional act on the part of the insured; and the intent of punitive damages would be lost if a defendant could avoid payment simply by buying more insurance.
In the state of New Jersey, punitive damages are allowed to be as much as 5 times the amount of compensatory damages. The Texas $229 million punitive damage award against Merck, even when reduced, will still be about $26 million. Legal analysts say no company could avoid financial ruin if ordered to pay tens of thousands of $26 million punitive damage awards.
Punitive damages provide a basis for a derivative lawsuit seeking damages for conduct that compromised the value of the investments of shareholders. These types of lawsuits are being filed for much less than what Merck pulled with Vioxx.
For instance, in March 2005, a class action lawsuit was filed in the US District Court for the District of Massachusetts, on behalf of shareholders in Elan Corp PLC, after the company's withdrawal of the multiple sclerosis drug Tysabri, with many of the same allegations that can be made against Merck.
The complaint alleges that Elan failed to disclose and misrepresented material adverse facts in connection with Tysabri including serious immune-system side effects and that the information was concealed in order to fast track Tysabri for FDA approval.
In any event, notwithstanding that Merck continues to contend that it will try every single case, legal analysts say, state courts will never be able to handle the trials for the lawsuits already filed, much less the additional cases still being filed on a regular basis.
"At some point courts are going to be clogged with these cases and judges will start to put pressure on Merck and the plaintiffs to settle these cases," according to John Leubsdorf, professor of law at Rutgers Law School, on CNN Moneyline on April 26, 2006.
"The only scenario in which they won't settle," he says, "is if they win so much that all the plaintiffs go away."
But experts say that is definitely not going to happen.
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