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Reflexive Litigation

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Major news outlets have been reporting over the last month about the public disclosure of a previously confidential study of the cholesterol drug Vytorin (see NY Times, Wall St. J.).  The so-called "Enhance" study apparently indicates that the drug, while effective in lowering cholesterol, provides few if any cardiac benefits over generic drugs.  Given the risks inherent in just about every medication on the market, a finding of reduced medical benefit could significantly alter the cost-benefit equation of treatment with Vytorin.  Today, the National Law Journal reports that a flood of lawsuits claiming fraud have been triggered by the alleged failure to publicly disclose the clinical studies (they were completed in 2006 and disclosed to the FDA).  Could such litigation have broader impacts than the individuals involved?

I wrote about this issue last year in an article published in the Indiana Law Journal.  Lawsuits of the type above seek to punish companies for withholding information.  While that seems like a very good idea, a rational company may react in a negative fashion.  Particularly, a company may decide to refrain from undertaking any study that is not absolutely required by the FDA.  Since the failure to undertake a study has almost never been successful as a cause of action, there is less liability risk for companies that study less.  Paradoxically, the forced disclosure of existing information may lead to the generation of less information.  Recent changes to FDA law as a result of the FDA Amendments Act of 2007 give the HHS Secretary the power to order new clinical studies after the drug is on the market (a power not previously available to the Agency), but this creates no incentive for a company to undertake a voluntary study.

The counter to disclosure-related litigation is FDA preemption — in other words, deciding that compliance with the federal government’s disclosure rules precludes any state action to the contrary.  The idea is to prevent conflicting disclosure policies.  To date, courts have been split on the application of preemption.  As future issues involving drug disclosure questions occur (and it seems inevitable that they will), the rules on preemption will need to become clearer.  The Supreme Court may decide this issue in 2008 in Wyeth v. Levine (see SCOTUSBlog for relevant filings).  The Court has also granted cert. to a similar case, Warner-Lambert v. Kent involving the question of fraud on the FDA.

 

About the Author

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Dan Cahoy is Associate Professor of Business Law at Penn State's Smeal College of Business. He is also a registered patent attorney. For more information, take a look at Dan's CV Web bio  or Research Page.

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