Healthy Skepticism Library item: 13491

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Publication type: news

Van Voris B
Eli Lilly Zyprexa Lawsuit May Be Scaled Back, Judge Says
Bloomberg.com 2008 Apr 11
http://www.bloomberg.com/apps/news?pid=20601202&sid=alX6_7u.ycQc&refer=healthcare

Full text:

A U.S. judge said he might scale back a lawsuit by purchasers of Eli Lilly & Co.‘s top-selling drug Zyprexa and raised questions about whether the case should go forward at all.

U.S. District Judge Jack Weinstein in Brooklyn, New York, said yesterday at a hearing that he probably won’t allow patients and insurers who paid for Zyprexa for uses approved by the U.S. Food and Drug Administration, including schizophrenia and bipolar disorder, to sue as a group. He also said he doesn’t expect the purchasers will be able to claim punitive damages.

The case ``ought to be settled,’‘ Weinstein told lawyers for both sides. ``I really think that we’re not dealing with very much money.’‘

Weinstein questioned whether an appeals court ruling last week in a case against cigarette makers requires him to reject the purchasers’ request to have the case certified as a class action, or group suit.

In that decision, a federal appeals court in New York on April 3 reversed Weinstein’s decision certifying a nationwide class of ``light’‘ cigarette smokers who claim U.S. cigarette makers defrauded them into believing those products were safer than regular cigarettes. The appeals court ruled there were too many differences among the smokers for their claims to be tried at one time.

Smoker’s Lawsuit

Anthony Vale, a lawyer for Indianapolis-based Lilly, argued yesterday that the ruling in the smokers’ suit, known as the ``Schwab’‘ case after the lead plaintiff, blocks Weinstein from granting class status to Zyprexa purchasers.

``We’re up against Schwab, aren’t we, with respect to individual issues?’‘ Weinstein asked Thomas Sobol, a lawyer for the Zyprexa purchasers.

Sobol argued that Weinstein should certify classes of individual Zyprexa users and third-party payers, including insurers. Sobol said Lilly exaggerated the effectiveness of Zyprexa and failed to adequately warn about side effects including weight gain, diabetes and other illnesses.

The purchasers also claim Lilly promoted Zyprexa for unapproved, or off-label uses, including for treating elderly dementia patients and children. Lilly is accused in the suit of violating U.S. civil-racketeering laws. The purchasers seek to recover money they say they were overcharged for the drug.

Makers of drugs aren’t permitted to promote their products for conditions not approved by the FDA, although doctors are free to prescribe such ``off-label’‘ uses.

Reconsideration

Weinstein said he wouldn’t certify a class based on uses approved by the FDA. Later in the hearing, he said he would reconsider that decision before issuing a final ruling. Weinstein didn’t say when he would issue a ruling.

The judge said he would consider certifying a class of off- label Zyprexa purchasers. Class status increases the leverage of plaintiffs to negotiate settlements or pursue large damage awards at trial. If Weinstein denies the purchasers’ request, only those with very large claims may choose to sue on their own.

``I think most civil litigation should be settled,’‘ Sobol said outside the courtroom, when asked about Weinstein’s suggestion to resolve the case. ``But it takes two to tango.’‘

At the end of the hearing, Weinstein, who is overseeing federal suits involving Zyprexa, referred to a suit that claims shareholders were defrauded by Lilly’s failure to disclose information about the drug, causing them to lose money when the information became public.

``I don’t think there’s much to that case,’‘ he said.

Zyprexa Sales

Zyprexa sales rose 9 percent last year to $4.76 billion, or about a quarter of Lilly’s revenue. Lilly has paid about $1.2 billion to settle 31,000 claims brought by patients who said they weren’t adequately warned that the medicine can cause diabetes, weight gain and inflammation of the pancreas.

About 1,200 similar lawsuits remain pending in the U.S., Lilly spokeswoman Tarra Ryker said in February.

Lilly agreed on March 25 to pay $15 million to settle Alaska’s claim that the drugmaker added to state medical costs by withholding data about the increased incidence of diabetes.

The settlement was reached three days before lawyers were scheduled to present closing arguments in the first U.S. trial over such claims. Alaska sought as much as $270 million in damages.

The case is UFCW Local 1776 Health and Welfare Fund v. Eli Lilly & Co., 05-CV-4115, U.S. District Court, Eastern District of New York (Brooklyn).