Articles Posted in Drugs & Biotech

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Solis alleged that his former employers violated the federal False Claims Act (FCA) by promoting dangerous off-label uses of a cardiovascular drug, Integrilin, and by paying physicians kickbacks to prescribe Integrilin and an antibiotic drug, Avelox. The district court found that Solis’s FCA claims were foreclosed by the public disclosure bar, which deprives federal courts of subject matter jurisdiction over FCA suits when the alleged fraud has already been publicly disclosed unless the relator is deemed an original source. The Ninth Circuit affirmed in part, holding that Solis’s Integrilin claims were substantially similar to those in prior public disclosures, and were close enough in kind and degree to have put the government on notice to investigate the alleged fraud before Solis filed his complaint. The court vacated the dismissal of Solis’s Integrilin claims and remanded for a determination of whether Solis qualified for the “original source” exception, 31 U.S.C. 3730(e)(4). Concerning Solis’s Avelox claims, the court held that the district court clearly erred in finding that the Avelox claims were publicly disclosed based on court complaints that never mentioned Avelox but affirmed the dismissal of Solis’s Avelox claims on the alternative ground of failure to plead with particularity as required by Fed.R.Civ.P. 9(b). View "Solis v. Millenium Pharmaceuticals, Inc." on Justia Law

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The Ninth Circuit affirmed the district court's judgment for EpiCept in an action brought by doctors, alleging claims for breach of contract, breach of the implied covenant of good faith and fair dealing, and fraud. The doctors' claims relate to two patents for a non-FDA approved drug (NP-2) and EpiCept's failure to develop those patents into FDA-approved drugs. The doctors' arguments mainly center on the jury's determination that the doctors materially breached their contract with EpiCept by failing to disclose that Dr. Flores treated burn patients with NP-2. The panel held that the district court did not abuse its discretion in formulating the jury instructions, or in determining that the jury's verdict was not against the clear weight of the evidence; neither the jury instructions given in this case nor the evidence presented at trial warrant the do-over the doctors demanded; the district court's response to the jury's question also did not merit a new trial because the jury's question was essentially factual and the district court's answer appropriately directed the jury to consider its original instructions and the evidence presented at trial; and because the panel affirmed the jury's finding that the doctors materially breached the contract, the district court's exclusion of the doctor's damages expert was necessarily harmless. View "Crowley v. EpiCept Corp." on Justia Law

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After plaintiff's son died of Hepatosplenic T-cell lymphoma (HSTCL), an exceedingly rare and aggressive form of cancer, they filed suit alleging negligence and strict liability concerning the manufacture and distribution of drugs used to treat inflammatory bowel disease (IBD). The Ninth Circuit reversed the grant of summary judgment to Teva, holding that the district court erred by excluding plaintiffs' causation experts' testimony. In this case, the district court looked too narrowly at each individual consideration under Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 589 (1993), without taking into account the broader picture of the experts' overall methodology. The district court improperly ignored the experts' experience, reliance on a variety of literature and studies, and review of the son's medical records and history, as well as the fundamental importance of differential diagnosis by experienced doctors treating troubled outpatients. Furthermore, the district court overemphasized the fact that the experts did not develop their opinions based on independent research and the experts did not cite epidemiological studies. The panel reversed the district court's grant of summary judgment to Teva in regard to the duty to warn claim because there was a genuine dispute of material fact as to whether the prescribing physician's conduct would have changed with warnings from Teva and GSK. The panel declined to affirm the district court on four alternative grounds and reversed the district court's denial of plaintiffs' motion for reconsideration. View "Wendell v. GlaxoSmithKline" on Justia Law

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The Supreme Court's opinion in CRST Van Expedited Inc. v. E.E.O.C., 136 S. Ct. 1642, 1646 (2016), effectively overruled Branson v Nott's holding that when a defendant wins because the action is dismissed for lack of subject matter jurisdiction he is never a prevailing party. In this case, Amphastar filed a qui tam action against Aventis under the False Claims Act (FCA), 31 U.S.C 3730, alleging that Aventis obtained an illegal monopoly over the drug enoxaparin and then knowingly overcharged the United States. The district court dismissed the suit based on lack of subject matter jurisdiction. The Ninth Circuit held that Amphastar's allegations were based on publicly disclosed information, and it lacked the direct and independent knowledge needed to be an original source. Therefore, the panel upheld the district court's judgment on the merits. However, the panel held that the district court erroneously concluded that it could not award attorneys' fees, because the FCA's fee-shifting provision contained an independent grant of subject matter jurisdiction and because a party who wins a lawsuit on a non-merits issue is a "prevailing party." The panel remanded for resolution of the attorneys' fees issue. View "Amphastar Pharmaceuticals v. Aventis Pharma" on Justia Law

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Serena Kwan appealed the dismissal of her second amended complaint for failing to state a claim upon which relief can be granted. In 2014, Kwan, On Behalf of Herself and All Others Similarly Situated, filed a class action against Defendants-Appellees, SanMedica International, LLC (“SanMedica”), and Sierra Research Group, LLC (“Sierra”), alleging violations of California’s Unfair Competition Law (“UCL”) and California’s Consumers Legal Remedies Act (“CLRA”). The complaint was based on an allegation that the defendants falsely represented that their product, SeroVital, provided a 682% mean increase in Human Growth Hormone (“HGH”) levels, that it was clinically tested, and that “peak growth hormone levels” were associated with “youthful skin integrity, lean musculature, elevated energy production, [and] adipose tissue distribution." The Ninth Circuit concluded the district court correctly concluded that California law did not provide for a private cause of action to enforce the substantiation requirements of California’s unfair competition and consumer protection laws. Further, the district court did not err in concluding that Kwan’s second amended complaint failed to allege facts that would support a finding that SanMedica International’s claims regarding its product, SeroVital, were actually false. Accordingly, the Court affirmed dismissal. View "Kwan v. Sanmedica Int'l" on Justia Law

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Plaintiff filed a putative securities class action against defendants in connection with public statements made about Arena’s weight-loss drug, lorcaserin. When Arena filed its application with the FDA, the FDA’s advisory panel published a briefing document that disclosed, for the first time, that Arena had been in a “highly unusual” back-and-forth with the FDA regarding the results of cancer studies on rats (the “Rat Study”). Plaintiff filed suit after news of the Rat Study broke. The district court dismissed the First, Second, and Proposed Third Amended Complaints. The court agreed that once defendants touted the safety and likely approval of the drug based on animal studies, defendants were obligated to disclose the Rat Study's existence to the market. The court concluded that plaintiff has alleged scienter with sufficient particularity to survive a motion to dismiss. In this case, there is no question that plaintiff has alleged that defendants knew that the Rat Study existed, that defendants knew that the FDA’s request for bi-monthly reports and follow-up studies was highly unusual and out-of-process, and defendants went ahead and told investors about their confidence in lorcaserin’s approval based on preclinical animal studies. Therefore, the court concluded that plaintiff has properly pleaded scienter under Federal Rule of Civil Procedure 9(b) and the Private Securities Litigation Reform Act (PSLRA), 15 U.S.C. 78u-4. The court reversed and remanded. View "Schwartz v. Arena Pharmaceuticals, Inc." on Justia Law

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The FDA opened an investigation and sent warning letters to 1-800-GET-THIN and a few surgery centers in California, stating that the FDA believed 1-800-GET-THIN’s LapBand advertising violated the Food, Drug, and Cosmetic Act (FDCA), 21 U.S.C. 301 et seq., by not providing relevant risk information regarding the LapBand procedure. The district court subsequently granted the government’s ex parte motion to compel production of attorney-client documents. The court agreed with the Sixth Circuit and concluded that, while in camera review is not necessary to establish a prima facie case that the client was engaged in or planning a criminal or fraudulent scheme when it sought the advice of counsel to further the scheme, a district court must examine the individual documents themselves to determine that the specific attorney-client communications for which production is sought are sufficiently related to and were made in furtherance of the intended, or present, continuing illegality. Accordingly, the court vacated the order compelling production of all subpoenaed documents so the district court may examine the documents in camera to determine which specific documents contain communications in furtherance of the crime fraud exception to the attorney client privilege. View "United States v. Omidi" on Justia Law

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Plaintiffs, non-profit organizations representing the manufacturers and distributors of pharmaceutical products, filed suit challenging the Alameda County Safe Drug Disposal Ordinance, which requires that prescription drug manufacturers, who either sell, offer for sale, or distribute "Covered Drugs" in Alameda, operate and finance a "Product Stewardship Program." The court concluded that the Ordinance, both on its face and in effect, does not discriminate because it applies to all manufacturers that make their drugs available in Alameda County - without respect to the geographic location of the manufacturer; the Ordinance does not directly regulate interstate commerce where it does not control conduct beyond the boundaries of the county; under the balancing test in Pike v. Bruce Church, Inc., the court concluded that, without any evidence that the Ordinance will affect the interstate flow of goods, the Ordinance does not substantially burden interstate commerce; and therefore, the Ordinance does not violate the dormant Commerce Clause. Accordingly, the court affirmed the district court's grant of summary judgment to defendants.View "PRMA v. County of Alameda" on Justia Law

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Plaintiff filed suit against Novartis, manufacturer of Zometa, alleging products liability, negligent manufacture, negligent failure to warn, breach of express and implied warranty, and loss of consortium. On appeal, plaintiff contended that the district court erred by excluding the causation testimony offered by her expert when it found the testimony to be irrelevant and unreliable. The court concluded that the expert's testimony was relevant because it indicated that plaintiff's bisphosphonate use was a substantial factor in her development of bisphosphonate-related osteonecrosis of the jaw. The court also concluded that the expert's testimony was reliable where he used a differential diagnosis grounded in significant clinical experience and examination of medical records and literature. Accordingly, the court concluded that the expert's testimony created a genuine issue of material fact regarding the specific causal link between plaintiff's bisphosphonates treatment and her development of osteonecrosis of the jaw. The court reversed the district court's summary judgment in favor of Novartis and remanded. View "Messick v. Novartis Pharmaceuticals Corp." on Justia Law

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GSK filed suit against Abbott over a dispute related to a licensing agreement and the pricing of HIV medications. The central issue on appeal was whether equal protection prohibited discrimination based on sexual orientation in jury selection. GSK contended that a new trial was warranted because Abbott unconstitutionally used a peremptory strike to exclude a juror on the basis of his sexual orientation. The court concluded that GSK had established a prima facie case of intentional discrimination where the juror at issue was the only juror to have identified himself as gay on the record and the subject of the litigation presented an issue of consequence to the gay community. The court held that classifications based on sexual orientation were subject to a heightened scrutiny under United States v. Windsor. The court also held that equal protection prohibits peremptory strikes based on sexual orientation. The history of exclusion of gays and lesbians from democratic institutions and the pervasiveness of stereotypes about the group leads the court to conclude that Batson v. Kentucky applied to peremptory strikes based on sexual orientation. The court also concluded that a Batson challenge would be cognizable only once a prospective juror's sexual orientation was established, voluntarily and on the record. The court rejected Abbott's harmless error argument. Accordingly, the court reversed and remanded. View "SmithKline Beecham Corp. v. Abbott Laboratories" on Justia Law