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From Products Liability Law Daily, October 28, 2013

Failure-to-warn and negligent design claims linked to off-label use of Botox® allowed

By Kathryn S. Beard, J.D. and Pamela C. Maloney, J.D.

Products liability failure-to-warn and negligence design claims alleging that a manufacturer’s promotion of and safety claims about off-label uses for potent neurotoxin caused the patient’s death survived the manufacturer’s motion to dismiss, a federal court in Illinois ruled (Rosenstern v. Allergan, Inc., October 25, 2013, Durkin, T.). Assertions that the manufacturer breached implied and express warranties and a corresponding wrongful death claim also survived the manufacturer’s attempt to dismiss them without a trial.

Background. Botox® Therapeutic (Botox) is Allergan’s name for Botulinum Type A, an injectable neurotoxin approved by the FDA to treat four specific conditions by paralyzing certain localized muscle areas. In 2003, Allergan doubled the size of its reimbursement team to assist doctors in obtaining payment for off-label, or unapproved by the FDA, Botox injections. Allergan held workshops teaching doctors and their staffs how to bill for off-label uses, demonstrated how doctors could make money by injecting Botox, and operated the Botox Reimbursement Hotline, which provided a wide array of free on-demand services to doctors for off-label uses. Allergan also lobbied government health care programs to expand coverage for off-label uses, directed physician workshops and dinners focused on off-label uses, paid doctors to attend “advisory boards” promoting off-label uses, and created a purportedly independent online neurotoxin education organization to stimulate increased use of Botox for off-label indications. In 2010, the Department of Justice announced that Allergan agreed to plead guilty and pay $600 million to resolve its criminal and civil liability arising from the company’s unlawful promotion of Botox for uses not approved as safe and effective.

In 2011, Janet Rosenstern received 75 units of Botox for her temporomandibular joint syndrome (TMJ), despite the lack of FDA approval for Botox as a TMJ treatment. Rosenstern and her physicians decided that it was an appropriate use of Botox in reliance on Allergan’s representations. Following the Botox treatment, Rosenstern suffered from severe back and neck pain, muscle weakness, and increased anxiety, depression, and migraines. Her condition progressed into severe acute immune reaction, which led to a suicide-precipitating brain injury. The executor of Rosenstern’s estate, her husband, filed an action against Allergan alleging failure to warn, defective manufacture, negligence, breach of implied and express warranties, negligent misrepresentation, and wrongful death, as well as a “survival action” for funeral costs and punitive damages. Allergan filed a motion to dismiss all claims.

Warning issues. The court found that the estate sufficiently pleaded that Allergan knew that Botox was unreasonably dangerous, yet failed to warn the patient or her health care providers. Allegations that the manufacturer knew of the dangers associated with Botox but failed to warn the prescribing physician or the medical community and that the alleged failure to warn caused the patient’s death, coupled with allegations that had the patient or her health care providers known of the risk, they would have refused to use the drug, were sufficient to show that it was plausible that the manufacturer had failed to warn of the risks of using the drug to treat TMJ. In addition, because the manufacturer was alleged to have promoted off-label use in violation of federal law, the learned intermediary doctrine was not applicable to the failure-to-warn claim.

The court also rejected the manufacturer’s argument that FDA regulations prevented it from providing warnings about off-label uses. The Food, Drug and Cosmetic Act did not completely preclude patients from asserting claims of fraud or false advertising.

Manufacturing defect. The complaint also was sufficient in stating a claim for manufacturing defect. Plaintiffs were not required to detail product-specific manufacturing information in a complaint because formal discovery often was necessary to provide a concrete basis for a defective product claim.

Negligence and warranty claims. The estate had detailed a number of allegations regarding the manufacturer’s Botox marketing practices, including creating and funding organizations to educate doctors about off-label uses, which was sufficient to show negligence in marketing and designing Botox. The manufacturer knew that Botox might be used to treat TMJ, which was sufficient to state a claim for a breach of implied warranty, and breach of an express warranty may be based on brochures, documents, and advertisements in Illinois. Because the five earlier counts were sufficiently pleaded, the court found that the estate could have had a viable action for wrongful injury at the time of her death, which allows her husband to maintain a wrongful death action.

Misrepresentation claim. However, the manufacturer successfully argued that Rosenstern’s negligent misrepresentation claim is actually a claim for fraudulent misrepresentation, and therefore is subject to heightened pleadings standards. Negligent misrepresentation requires an allegation of carelessness or negligence in ascertaining the truth of a false statement of material fact by the party making it. The estate did not allege that the manufacturer acted with carelessness or negligence in ascertaining the truth of its statements regarding Botox’s safety; rather, the complaint alleged that the manufacturer knowingly made false representations, concealed material information, and purposely downplayed the risks of Botox. Because the claim, as stated in the complaint, did not have the required particularity for pleading a fraud claim, the court dismissed that count without prejudice. The court also dismissed the estate’s “Survival Action” and a claim for punitive damages. The Survival Act does not provide a basis for funeral expenses, but merely allows a decedent’s representative to maintain actions for a decedent (See 755 ILCS 5/27-6). The estate disavowed the claim for punitive damages.

The case number is 13 C 4416.

Attorneys: James A. Karamanis (Barney & Karamanis, LLP) for Klaus Rosenstern. Stephen J. O'Neil (K&L Gates LLP) for Allergan, Inc.

Companies: Allergan, Inc.; Allergan USA, Inc.

MainStory: TopStory WarningsNews DesignManufacturingNews DamagesNews DrugsNews IllinoisNews

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