Conte on Steroids — The California Supreme Court Finds that Novartis Can Be Liable for a Drug It Hasn’t Made in Years

Jordan Lipp | Partner, Davis Graham & Stubbs LLP

 

A basic premise of product liability law is that it is the manufacturer of a product, not its competitors, is the sole entity liable for the harm caused by its own defective product.  This issue is of particular importance in the context of brand name versus generic drug manufacturers.  Courts throughout the nation have faced the question of whether the manufacturer of a name brand version of a drug is liable to a plaintiff who only took the generic version of the same drug.  The overwhelming precedent, with a handful of exceptions, has been that a name brand manufacturer cannot be liable if the plaintiff consumed a generic version of the drug.  One of those handful of exceptions was Conte v. Wyeth, a 2008 decision from the California Court of Appeals, which held that a brand name drug manufacturer has a duty to warn the prescribers of the generic versions of their drug.

On December 21, 2017, the California Supreme Court rejected the overwhelming precedent from other states, and following the Conte decision.  It held that brand name drug manufacturers have a duty to warn about their drugs, regardless of whether the plaintiff used the brand-name or generic version of the drug, so long as the plaintiff relied upon the brand name drug manufacturer’s warning.

Perhaps even more surprising was the California Supreme Court’s holding that the brand-name manufacturer’s sale of the rights to the drug did not terminate its liability.  The case, T.H. v. Novartis Pharmaceuticals Corp., — P.3d —,  2017 WL 6521684 (Cal. 2017), arose from a claim by two children (through their guardian ad litem) that their developmental delays and autism were caused by their mother’s use of terbutaline in 2007 during her pregnancy with them.  The brand name version of terbutaline is Brethine, which was manufactured by Novartis until 2001.  In 2001, six years before the generic version of the drug was actually used, Novartis sold its rights to the brand name drug to another drug company.

In spite of the facts that (1) the plaintiffs’ mother took the generic drug, not the brand name drug, and (2) when the mother took the generic drug, Novartis no longer held the rights to the brand-name equivalent, the California Supreme Court still found that Novartis could be liable.  On the first issue, the California Supreme Court held that “Because the same warning label must appear on the brand-name drug as well as its generic bioequivalent, a brand-name drug manufacturer owes a duty of reasonable care in ensuring that the label includes appropriate warnings, regardless of whether the end user has been dispensed the brand-name drug or its generic bioequivalent.”  On the second issue, the Court found that “If the person exposed to the generic drug can reasonably allege that the brand-name drug manufacturer’s failure to update its warning label foreseeably and proximately caused physical injury, then the brand-name manufacturer’s liability for its own negligence does not automatically terminate merely because the brand-name manufacturer transferred its rights in the brand-name drug to a successor manufacturer.”

Well aware that this decision runs contrary to the great weight of authority in other states, the California Supreme Court ended its opinion stating: “We do not doubt the wisdom of crowds in some settings. But the value of an idea conveyed by or through a crowd depends not on how loudly it is proclaimed or how often it is repeated, but on its underlying merit relative to the specific issue at hand.”  With this decision, California will continue to be a hotbed for pharmaceutical litigation for years to come.

The Evolving Healthcare Delivery Model and Potential Further Erosion of the Learned Intermediary Doctrine

Courtney A. Stevens, Esq. | Senior Attorney, Loss Control | Medmarc

Last month, some members of Medmarc’s Loss Control Department attended the DRI Drug and Medical Device Seminar in Chicago, Illinois. Among the many insightful presentations was one delivered by Randall L. Christian of Bowman and Brooke LLP and Marc Fishman, in-house counsel at Novo Nordisk Inc, titled The Future of Drug Warnings: Rems, Medication Guides, and the (Potential) Erosion of the Learned Intermediary Doctrine.

Without regurgitating the entire presentation here, especially in light of the fact that we have persuaded the speakers to present a similar version to the Medmarc audience via webinar, I will include a few salient points below.

  • The average time of a patient actually spends with a doctor per doctor visit is now seven minutes. In this context, is it still reasonable to believe that doctors will communicate all the appropriate risk information to patients? Will knowledge of the evolving doctor-patient relationship (to shorter and arguably more infrequent visits) be imputed to manufacturers, such that some courts might believe it unreasonable for manufacturers to expect that doctors will adequately deliver safety and risk information to patients?
  • Further vulnerability to the learned intermediary doctrine might be seen in the form of the numerous tools manufacturers, particularly of drugs, have at their disposal to communicate directly with patients—counseling tools, medication guides, and, of course, direct-to-consumer advertising. Manufacturers engage in direct communication with patients
  • Studies have found that patients better understand and retain warning information that included imagery. There is some speculation that, as such, the FDA may require certain warnings to include imagery and, even in the absence of a law of regulation, failure-to-warn claims might be successful on the theory that warnings were ineffective for their lack of imagery.

 

The bottom line is that the learned intermediary doctrine—a long-time, effective defense for makers of prescription products—is in play, and manufacturers, and it is reasonable to expect its change in light of the evolving healthcare model.

Products Liability Implications of the DIY Healthcare Environment

Courtney A. Stevens, Esq. | Senior Attorney, Medmarc Loss Control

Mark Senak recently published an insightful post over at Eye on FDA on “The Growing World of Do It Yourself Health.” In it, he remarks how the advent of certain products and technologies are accelerating the “DIY” movement in healthcare. Among the factors he points to as underlying this movement are “Dr. Google” and the overall ability of individuals to self-diagnose and learn about their conditions via the internet; direct-to-consumer advertising educating patients on conditions and treatment options; the massive supplement industry that allows consumers to self-prescribe a combination of non-drug products to treat or prevent specific maladies; social media facilitating crowd-sourcing and the sharing of symptoms and treatment solutions and experiences; and wearable devices and health apps that make available to users constant readings of health information like heart rate, activity levels, blood pressure, and sleep patterns. Being that the blog is Eye on the FDA, Mr. Senak’s focus is on the regulatory implications of these changes. He notes that the FDA has been rather slow in addressing the change that these factors have precipitated and are, perhaps understandably, struggling to keep up with this area of such dynamic change.

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