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From Products Liability Law Daily, September 2, 2014

$9 billion Actos verdict against Takeda, Eli Lilly stands

By John W. Scanlan, J.D.

A federal district court refused to overturn a $9 billion jury verdict against Eli Lilly and Takeda Pharmaceuticals in a case brought by a man who developed bladder cancer after taking Actos for his diabetes. The U.S. District Court for the Western District of Louisiana rejected the pharmaceutical companies’ arguments that there was insufficient evidence supporting the verdict and that the claims were preempted under federal law (In re: ACTOS (Pioglitazone) Products Liability Litigation (Allen v. Takeda Pharmaceuticals North America, Inc.)), August 28, 2014, Doherty, R.).

Background. In 1998, Takeda Pharmaceutical Company Limited, Takeda Pharmaceuticals U.S.A., Inc., Takeda Pharmaceuticals International, Inc., Takeda Pharmaceuticals LLC, Takeda Development Center Americas, Inc., Takeda California, Inc. (collectively, Takeda) entered into an agreement with Eli Lilly and Company, giving Eli Lilly the exclusive right in the United States to co-promote Actos (pioglitazone Hcl), a drug developed by Takeda to treat type 2 diabetes. Eli Lilly’s active promotion of the drug ended in March 2006.

In June 2006, Terrence Allen began taking Actos under a prescription. Allen was diagnosed with bladder cancer in January 2011 and stopped taking Actos in April 2011. Allen, along with his wife Susan Allen, brought product liability and other claims against Takeda and Eli Lilly as part of multidistrict litigation regarding Actos. The jury found that Actos exposure increased the risk of bladder cancer; that Takeda and Eli Lilly were aware of the increased risk; that they undertook a coordinated pattern of effort over several years to prevent the FDA, the medical community, and the public from knowing about this increased risk; and that they did so to preserve the profits Actos was generating for them in the United States and globally. The jury awarded the Allens $6 billion in punitive damages against Takeda and $3 billion against Eli Lilly. It also awarded Terrence Allen $150,000 in past compensatory damages and $1 million in future compensatory damages and awarded his wife Susan Allen $325,000 in damages for loss of consortium; Takeda was assigned 75 percent of the liability on those damages and Eli Lilly 25 percent. The two companies moved for judgment as a matter of law and a new trial.

Evidence supporting the jury verdict. The evidence presented by the plaintiffs established a legally-sufficient basis for the jury verdict, the court found. It showed that the defendants’ failure to provide an adequate warning was not an oversight or the result of mere negligence; their effort to withhold information from the FDA despite the agency’s misgivings prevented the medical community, including Allen’s doctors, from receiving complete descriptions of the data and scientific analyses and the warnings that would have come from them. Both defendants marketed Actos to Allen’s physicians, but the physicians never understood the label or product information to include a warning of an increased risk of bladder cancer, nor did they hear of this risk from any representative of either company. The plaintiffs showed that Allen’s physicians would not have prescribed Actos for him if they had received an adequate warning. The jury’s findings and awards showed broad acceptance of the plaintiffs’ evidence, particularly of the opinions of their experts, and the challenges to the defendants’ experts by the plaintiffs gave the jury ample opportunity to accept the testimony of the plaintiffs’ experts over the testimony of the defendants’ experts.

The court noted what it called the defendants’ “overall false framing” of certain issues in their motion: Takeda’s argument that Actos provided a valuable service to diabetics as a whole, which was reflected by the fact that it was still on the market, was a misdirection from the issue of whether a drug company may withhold information of a known health risk to members of that same target population.

Preemption. The court disagreed with Eli Lilly’s arguments that the state law claims against it were preempted because it was unable to change the Actos label. Lilly argued that it was precluded from including on any written document used in marketing or distribution any information or language beyond the language approved by the FDA for use on the insert label. However, the court found that Lilly had not identified any statute, regulation, or controlling jurisprudence to support this assertion. The “sameness” requirements that apply to manufacturers of generic drugs did not apply to Lilly because it was not a generic drug manufacturer, nor was Takeda. The U.S. Supreme Court previously rejected in Wyeth v. Levine, 555 U.S. 555 (2009), the premise of Lilly’s argument that providing information about a health risk or providing an enhanced warning of a serious health risk automatically constitutes a misbranding violation. Further, the court noted that a former Lilly employee responsible for marketing Actos testified that the content of Lilly’s sales pitches and marketing efforts to physicians were not limited to the label but also included information that was “deemed consistent with the label.” The plaintiffs provided substantial evidence that Lilly was not a simple marketer for Takeda but played a large role in the development of the label and the dissemination of information for Actos.

The court also ruled against preemption arguments brought by both Takeda and Eli Lilly. The defendants asserted that it was impossible for them to comply with both federal and state requirements. The court first said that Takeda and Eli Lilly had misread Wyeth; the U.S. Supreme Court held that the “clear evidence standard” for the impossibility defense cannot be met if the FDA has not given serious consideration to the issue, not that this standard is automatically met if the FDA has given careful consideration to it. The plaintiffs provided evidence showing that Takeda had, in fact, withheld information from the FDA that showed a risk of bladder cancer with Actos use even when it was asked to provide more information. New York law required Takeda to make a full and complete disclosure of scientific data to the FDA and required Lilly to disclose the actual increased risk of bladder cancer in Actos users to the doctors to whom the company marketed Actos, but evidence showed that Takeda resisted FDA efforts to change the label and Lilly failed to provide the information to doctors. Their argument that the FDA would not have approved an enhanced warning on bladder cancer ignored the evidence that they had resisted FDA overtures to include a warning and had engaged in a concerted effort to prevent the FDA from including any such warning; further, the court did not believe that the FDA would have chosen to hide from the public the possibility of an increased risk of bladder cancer from taking Actos had it received a complete and accurate description of the evidence. Similarly, their argument that the plaintiffs’ claims presented an obstacle to the FDA’s ability to regulate Actos properly did not acknowledge that they had withheld information from the FDA and obfuscated the agency’s efforts to investigate a possible Actos-bladder cancer link.

Failure to warn. Sufficient evidence supported the plaintiffs’ failure-to-warn claim against Eli Lilly, the court said. They presented sufficient, substantive evidence that Lilly had failed to give an adequate warning to Allen’s physicians, with the plaintiffs’ theory of liability based on the company’s failure to communicate with those physicians and their physicians’ testimony that they would not have prescribed Actos to Allen if they had been presented with adequate warnings. The defendants’ argument that the plaintiffs had the obligation to prove the content of Lilly’s communications with Allen’s physicians was an attempt to shift the burden of proof.

Specific causation. The court found that there also was sufficient evidence on specific causation to support the jury’s finding The defendants’ challenge to the plaintiffs’ reliance on testimony and exhibits provided by urologic oncologist Dr. Scott Delacroix ignored the substance of his testimony, and the fact that they disagreed with him was not a basis for the court to disregard his testimony. The court noted that it had previously addressed their objections. The fact that people similar to Allen but who have not taken Actos developed bladder cancer was irrelevant because neither Delacroix nor the plaintiffs had argued that Actos was the only possible cause of Allen’s bladder cancer, but only that it was a substantial factor. The drug companies’ argument that the absolute risk of bladder cancer in the pool of patients who had taken Actos was low was misleading because it did not address the increased risk to patients in any identifiable category of individuals for whom the risk was not low. Finally, their argument that Delacroix admitted that he could not tell from visual inspection alone whether Allen’s tumor was caused by Actos was a straw-man argument because they presented no evidence showing that a diagnosis by visual inspection can be or has ever been accomplished by any physician or that Actos works on bladder tissue by changing its appearance.

Wanton and reckless disregard. The evidence sufficiently supported the jury’s finding that Takeda and Eli Lilly acted with a wanton and reckless disregard for Allen and others similarly situated. The plaintiffs presented evidence that Takeda and Eli Lilly were aware of the risk of death by bladder cancer associated with Actos but concealed this knowledge to protect their sales and profits. Their evidence also showed that the companies worked to conceal relevant information from the FDA, the medical community, the public, Allen’s physicians, and Allen, and that this intentional concealment reflected a deliberate decision to disregard the well-being of Allen and other diabetics within the target population for whom Actos would be contraindicated. As a result of this behavior, Allen’s physicians prescribed Actos to him, which they would not have done if they had known the information Takeda and Lilly were concealing. The jury could conclude from this evidence that the two companies exhibited a sufficiently callous attitude toward Allen and others like him to satisfy New York’s “wanton and reckless disregard for public safety” standard. The court found that the defendants would hold the plaintiffs to a higher standard than that required under state law but noted that the defendants had repeatedly passed up the opportunity to request the heightened language be included in the jury instructions and, therefore, this argument was waived for failure to timely assert it.

Punitive damages. Finally, the court overruled Eli Lilly’s objections on punitive damages. Lilly’s argument that it could not be held liable for punitive damages solely on the basis of its role as co-promotion partner with Takeda was a straw-man argument because the claims against it were not based solely on this status; the evidence showed it was an active partner in marketing Actos and managing information about it with Takeda, and between 1999 and 2006 it was the only company selling and distributing Actos within the United States. The court said that it had previously ruled on Lilly’s argument that it could not be held liable because its involvement in Actos’s promotion ended a month before Allen was prescribed Actos, noting that Lilly employees had marketed Actos to Allen’s physicians before the doctors prescribed it to Allen, with no warning information. Finally, evidence showed that Lilly knew of the risk of bladder cancer but hid this information despite dozens of contacts with the doctors’ offices before they prescribed Actos to Allen.

The case number is 12-cv-00064-RFD-PJH; MDL No. 6:11-md-2299.

Attorneys: Paul J. Pennock (Weitz & Luxenberg) for Terrence Allen. Jaimme Angelle Collins (Adams & Reese) for Takeda Pharmaceutical Co. Ltd. Colin J. Garry (Sidley Austin) for Takeda Pharmaceuticals LLC, Takeda Pharmaceuticals International, Inc., Takeda California, Inc., Takeda Pharmaceuticals U.S.A., Inc., and Eli Lilly & Co.

Companies: Takeda Pharmaceutical Co. Ltd.; Takeda Pharmaceuticals LLC; Takeda Pharmaceuticals International, Inc.; Takeda California, Inc.; Takeda Pharmaceuticals U.S.A., Inc.; Eli Lilly & Co.

MainStory: TopStory DamagesNews EvidentiaryNews DrugsNews PreemptionNews WarningsNews LouisianaNews NewYorkNews

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