Wyeth vs. Conte: Are Big Pharmas Now Liable for Generics?

There was a legal ruling last week in California that we’re going to hear a lot more of in this business. Conte v. Wyeth (WYE). This case involved metaclopramide, which was sold by Wyeth as Reglan before going off-patent in 1982. The plaintiff had been prescribed the generic version of the drug, was affected by a rare and serious neurological side effect (tardive dyskinesia, familiar to people who’ve worked with CNS drugs) and sued.

But as you can see from the name of the case, this wasn’t a suit against her physician, or against the generic manufacturer. It was a suit against Wyeth, the original producer of the drug, and that’s where things have gotten innovative. As Beck and Herrmann put it at the Drug and Device Law Blog:

The prescribing doctor denied reading any of the generic manufacturer's warnings but was wishy-washy about whether he might have read the pioneer manufacturer's labeling at some point in the more distant past.

Well, since the dawn of product liability, we thought we knew the answer to that question. You can only sue the manufacturer of the product that injured you. Only the manufacturer made a profit from selling the product, and only the manufacturer controls the safety of the product it makes, so only the manufacturer can be liable.

Not any more, it seems. The First District Court of Appeals in San Francisco ruled that Wyeth (and other drug companies) are also liable for harm caused by the generic versions of their drugs. At first glance, you might think “Well, sure – it’s the same drug, and if it causes harm, it causes harm, and the people who put it on the market should bear responsibility”. But these are generic drugs we’re talking about here – they’ve already been on the market for years. Their behavior, their benefits, and their risks are pretty well worked out by the time the patents expire, so we’re not talking about something new or unexpected popping up (and in this case, we're talking about a drug that has been generic for twenty-six years).

The prescribing information and labeling has been settled for a long time, too, you’d think. At any rate, that’s worked out between the generic manufacturers and the FDA. How Wyeth can be held liable for the use of a product that it did not manufacture, did not label, and did not sell is a mystery to me.

Over at Law and More, a parallel is drawn between this ruling and the history of public nuisance law during the controversy over lead paint; the implication is that this ruling will stand up and be with us for a good long while. But at Cal Biz Lit, the betting is that “this all goes away at the California Supreme Court.” We’ll see, because that’s exactly where it’s headed and maybe beyond that, eventually.

And if this holds up? Well, Beck and Herrmann lay it out in their extensive follow-up post on the issue, which I recommend to those with a legal interest:

Conte-style liability can only drive up the cost of new drugs – all of them. Generic drugs are cheaper precisely because their manufacturers did not incur the cost of drug development – costs which run into the hundreds of millions of dollars for each successful FDA approval. Because they are cheap, generics typically drive the pioneer manufacturer’s drug off the market (or into a very small market share) within a few years, if not sooner. Generic drugs will stay cheap under Conte. But imposing liability in perpetuity upon pioneer manufacturers for products they no longer sell or get any profit from means that the pioneer manufacturers (being for-profit entities) have to recoup that liability expense somewhere. There’s only one place it can come from. That’s as an add-on to the costs of new drugs that still enjoy patent protection.

Exactly right. This decision establishes a fishing license for people to go after the deepest-pocketed defendants. Let’s hope it’s reversed.

Comments

[ex-chem:]

Interesting. The original manufacturer (Wyeth) is not able to protect themselves or the public by removing the offending product from the market, since they no longer own the rights to the product. They only own the liability. Ain't America great? Ain't California the greatest?

2008 Nov 18 05:34 PM