Healthy Skepticism Library item: 17236

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Publication type: news

Feeley J, Cronin Fisk M
AstraZeneca Faces First Trial Over Seroquel Claims (Update2)
Bloomberg.com 2010 Feb 19
http://www.bloomberg.com/apps/news?pid=20601202&sid=a.qMy6.XdEo4

Full text:

AstraZeneca Plc didn’t hide the diabetes risks of the antipsychotic drug Seroquel, Chief Executive Officer David Brennan said before the first trial over the medicine began today in New Jersey.

“Any time you go to trial, there’s risk — we worry,” Brennan said in a Feb. 11 interview. “We acted very responsibly. Our label adequately and appropriately reflected everything we knew about the drug.”

Jurors in state court in New Brunswick will hear a Vietnam War veteran’s lawsuit against AstraZeneca, the U.K.’s second- largest drugmaker. Ted Baker contends he developed diabetes after taking Seroquel to deal with lingering symptoms of post- traumatic stress disorder and wasn’t properly warned about the drug’s risks. His case is the first to go to trial of about 26,000 such claims over Seroquel.

The jury selected today includes five women and four men. Opening statements begin Feb. 22. If U.S. juries rule against the company and hand out sizeable punitive damage awards, AstraZeneca may be looking at as much as $1 billion in verdicts over the medicine, said Navid Malik, an analyst at Matrix Corporate Capital in London.

“The risk is very low,” Malik said. “It’s going to be a long and drawn-out road for patients who are trying to see this thing proven, simply because I think diabetes is a much more complicated disease.”

Medical History

AstraZeneca will point to other factors that might have played a role in causing Baker’s diabetes, such as his lifestyle or family medical history, Malik said.

AstraZeneca fell last month after fourth-quarter profit missed estimates and sales forecasts disappointed some analysts. Company executives plan to eliminate 11 percent of the drugmaker’s workforce by the end of this year as part of a $2 billion restructuring, the cost of the savings program between now and 2013.

AstraZeneca’s American depositary receipts, each representing one ordinary share, fell 2 cents to $43.91 in New York Stock Exchange composite trading today. The drugmaker’s 5.9 percent bonds due in 2017 fell 1.9 cents on the dollar, or 1.7 percent, biggest drop since August, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Lawyers for London-based AstraZeneca will try to persuade jurors that Seroquel didn’t contribute to Baker’s diabetes and the drugmaker didn’t hide its health risks, said Dan Carlat, a psychiatrist at Tufts University School of Medicine in Boston who writes about antipsychotics drugs.

Diabetes Links

“The question is whether the links between Seroquel and diabetes are strong enough to convince a jury the drug is at fault,” Carlat said in an interview. Seroquel, with sales of $4.9 billion last year, is the company’s second-biggest seller after the ulcer treatment Nexium.

Former Seroquel users will have to convince each jury the drug was a specific cause of their diabetes, said Betsy Grey, an Arizona State University law professor who teaches product- liability and mass-tort law.

“In many states, the drug doesn’t have to be the single cause of the injury, but it has to be singled out as a substantial and significant factor,” Grey said. “That’s still very, very difficult to prove.”

The company faces almost 26,000 claims that Seroquel caused diabetes, it said in a U.S. Securities and Exchange Commission filing. That’s a 65 percent increase in cases over the number in a January 2009 regulatory filing.

Approved Use

Many of those suing also claim AstraZeneca promoted Seroquel, government-approved for schizophrenic and bipolar patients, to treat other conditions.

U.S. District Judge Anne Conway in Orlando, Florida, overseeing pretrial proceedings in federal Seroquel litigation, will ask a panel of judges to return the 6,000 cases consolidated before her to their home courts for trial, she said in November.

Carlat, of Tufts, noted that some AstraZeneca internal documents unsealed in the litigation show company officials expressed concern about the drug’s potential for causing weight gain and high blood-sugar levels in some users.

Carlat prescribes Seroquel for “a very limited” number of patients, he said.

“There are a lot of real smoking guns when you look through the documents that have been unsealed,” the psychiatrist said. That may make it easier for jurors to reject AstraZeneca’s arguments that the drug didn’t cause diabetes, he added.

‘Cherry Picking’

In a December 1999 e-mail, an AstraZeneca manager said that the company failed to publicize results of at least three clinical trials of Seroquel and engaged in “cherry picking” of data from one study for use in a presentation.

One of the studies was “buried” because it didn’t produce favorable results on the weight-gain issue, John Tumas, an AstraZeneca publications manager, said in the e-mail. Weight can be a risk factor for diabetes.

“The larger issue is how we face the outside world when they begin to criticize us for suppressing data,” Tumas told colleagues in the message. Tumas still works for AstraZeneca in the U.S., Tony Jewell, the company’s U.S. spokesman, said in an interview.

Documents showed AstraZeneca officials encouraged the sales force to tell U.S. doctors Seroquel didn’t cause diabetes more than two years after warning physicians in Japan in 2002 about the drug’s possible links to the disease.

FDA Warning

Studies have shown that Seroquel and other atypical antipsychotic drugs are associated with weight gain and an increased risk of diabetes, plaintiffs lawyers contend. These studies prompted the U.S. Food and Drug Administration to require AstraZeneca and other drugmakers to warn doctors and patients of those risks in 2003.

AstraZeneca paid about $656 million to defend itself in Seroquel cases, officials said in the Jan. 28 SEC filing. That is an increase of $144 million, or 28 percent, over last year’s Seroquel defense costs, according to regulatory filings.

The drugmaker said it had insurance of $521 million to cover Seroquel defense costs as of December, an increase of $95 million, or 22 percent, from 2008.

“Given the status of the litigation, legal defense costs for the Seroquel claims, before damages, if any, are likely to exceed the total stated upper limits” of the company’s insurance coverage, officials said in a Jan. 28 statement.

Dismissal Rejected

The plaintiff in the New Jersey case, Baker, 61, sued AstraZeneca in July 2007 after taking the drug for three years. New Jersey Judge Jessica Mayer, who is presiding over the trial, on Feb. 5 rejected AstraZeneca’s bid to have the Louisiana resident’s claims thrown out.

Jurors must decide the factual questions of whether the drug contributed to Baker’s diabetes and whether the company warned him adequately, Mayer ruled.

“We believe that plaintiffs cannot show that their use of Seroquel caused any weight gain of the extent or duration associated with diabetes,” Jewell said in a Feb. 9 interview.

The case is Baker v. AstraZeneca Pharmaceuticals LP, MID L 1099 07 MT, Superior Court of New Jersey, Law Division, Middlesex County (New Brunswick).