We’ve been getting a lot of questions over the past few days about Seroquel. That usually means I need to put up a new post, especially in light of recent events.
Earlier this week, AstraZeneca (the manufacturer of Seroquel) agreed to pay $520 million to settle a federal inquiry into Seroquel marketing practices. As we have stated before, Seroquel is approved to treat schizophrenia and bipolar disorder. However, investigators and plaintiffs believe that AstraZeneca marketed the drug for myriad other unapproved uses, including depression, obsessive-compulsive disorder, dementia, and post-traumatic stress disorder.
There are no criminal charges associated with the deal. Giving credence to plaintiffs’ claims (aside from the credibility arising from the mere fact of a whopping large settlement), is that federal investigators got much of their information from AstraZeneca whistleblowers, drug sales rep, James Wetta (who had some involvement in the whistleblowing at Eli Lilly around 2003).
The deal comes at a time when such deals seem to be simply the cost of doing business. As just one example, Boston Scientific is in the midst of trying to settle with investigators for $296 million over the actions of a company it acquired, Guidant. Seroquel’s settlement pales in light of the fact that in 2009 alone, they made $4.9 billion in Seroquel sales. Isn’t that criminal?
Anyway—civil lawsuits are still continuing, but Plaintiffs are having a hard time of it. For more information, visit Drug Recall Lawyer Blog posts on Seroquel.
In a bold move, Judge Donovan Frank rejected a $296 million plea deal, offered by Boston Scientific and prosecutors. The proposed agreement was offered for Guidant’s failure to timely report problems with some of its defibrillators, which have caused at least seven deaths and numerous injuries. Boston Scientific purchased Guidant back in 2006. The federal Minnesota judge considered the arrangement, but ultimately rejected deal (which included a guilty plea by Guidant for two misdemeanors: submitting a false and misleading report to the FDA, and failing to notify the FDA about a device safety correction).
Judge Frank stated that “[a]t a minimum, the public’s interest in accountability would be served by Guidant and Boston Scientific being placed on probation, regardless of the fact that Boston Scientific acquired Guidant after the events in question. And, the court believes that a period of probation would likely benefit, rather than harm, Guidant’s and Boston Scientific’s public image.” The judge indicated that some measure of community service would be appropriate.
More Guidant/Boston Scientific Information
The judge concluded that he could not properly order restitution to victims directly, because patients were not “directly harmed” by the misdemeanors that Guidant fessed up to.
Prosecutors and Boston Scientific will revisit the agreement, and seem likely to modify it to satisfy the judge’s concerns. If the monetary amount stays the same, this will be the largest such monetary “fine” levied on a medical device manufacturer. Many judges would have taken it, but Judge Frank is doing his best to do what is right.
I confess that I have a little soft spot for Boston Scientific in all of this—it purchased a company with a bad history in hopes of turning it around, and it’s getting a lot of grief for its trouble. But, it would be too easy to let them off the hook simply because Guidant changed its corporate form. I think the company will emerge stronger for the experience.
Here are the stories we’re following this week:
- Infusion pumps: The FDA is tightening regulation of infusion pumps, which have reportedly caused 710 deaths in the past five years, and have been subject to 79 recalls since 2005 (news links to The New York Times, The Wall Street Journal, Associated Press, Reuters).
- Guidant: Brian Nash’s perspective on the defective Guidant defibrillator settlement proposal.
- Fosamax: Apparently, the trial has been going on all week (HT: Shearlings Got Plowed).
- Sprint Fidelis Leads: Last week, the 8th Circuit Court of Appeals heard arguments in Case no. 9-2290, Anna Bryant v. Medtronic. You can hear the recording here.
- Pfizer: The FDA issues a warning to Pfizer about clinical trials where children received excessive dosages of antipsychotics (HT: FiercePharma).
- Boston Scientific: The Guidant-purchaser is set to resume sale of some defibrillators which were recalled last month after it notified the FDA that some paperwork wasn’t properly submitted. (see The Wall Street Journal (subscription req’d)).
The New York Times published an article yesterday, “When Heart Devices Fail, Who Should Be Blamed?” The article puts a nice gloss on how and whether a company and people in charge of a company can properly make amends and taking personal/corporate responsibility.
The backstory is of course that a federal judge is considering whether to accept a $296 million fine, and a guilty plea to two criminal misdemeanors by Guidant (now Boston Scientific). Two cardiologists are urging the judge to reject the deal, and instead want prosecution of the company “and the individuals responsible.” The cardiologists, who cared for 21-year old patient who died because his Guidant device did not properly function, further state:
Manufacturers control the quality of their products. Manufacturers are the first to know when a medical device is dangerous or underperforming. Thus, it is in the best interest of patients, and society in general, for manufacturers to be liable for the safety and effectiveness of their products. To allow a repeat offender, like Guidant, to escape with a fine (that is entirely borne by the shareholders of Boston Scientific) does not hold the guilty parties fully accountable and inevitably undermines patient safety.
Sadly, it’s hard to know what the cardiologists are really looking for. I suspect they want the executives in charge to be put in jail, or have to pay fines from their own pockets. But, this may be a situation where there is no relief, as thousands of patients and their families know because they are prevented from filing meaningful civil lawsuits. The only thing we can do is work to repair the damage caused by medical device immunity.
For more on the Guidant topic, see our prior blog posts.
Sometimes, personal responsibility is hard to come by. The same can be true of corporate responsibility, which is simply another version of personal responsibility (under the law, corporations are entities capable of suing and being sued, and doing many of the same things that people do).
Exhibit A is Guidant’s plea in federal court on Monday. Guidant (recently acquired by Boston Scientific) pleaded guilty to criminal violations of the Federal Food, Drug and Cosmetic Act. Specifically, it pleaded guilty to two violations:
- making a materially false statement in a required submission to the FDA (Ventak Prizm 2DR)
- Failing to notify the FDA of a “correction” made to reduce a health risk caused by defibrillators (Contak Renewal)
As part of the plea, Guidant is agreeing to pay over $296 million in criminal penalties, the largest criminal penalty ever imposed on a device manufacturer. Judge Donovan Frank is reviewing the plea agreement.
The defibrillators are devices implanted near the heart, designed to provide life-saving electrical jolts to patients with heart defects. Because of the defective devices, people have died when the devices did not function as they were expected to. Prosecutors allege that the manufacturer, which had notice of the problems, tried to cover up the fact that those deaths were caused by the defibrillators.
More Guidant Recall Information
It is important to remember that none of the $296 million is going to Guidant’s victims or their families. The company is being held criminally responsible, but civil responsibility is elusive here. Even though Guidant admitted its wrongdoing, the U.S. Supreme Court decision in Riegel v. Medtronic holds that medical device manufacturers cannot be held civilly responsible for devices approved by the FDA’s premarket approval process.
So, there’s only limited responsibility here. The Medical Device Safety Act (introduced in Congress as S. 540 and H.R. 1346) is designed to remedy that situation.
If a rich man clubs a child with a baseball bat, shouldn’t he be sent to jail and subject to paying for the child’s injuries? Same thing should hold true for corporations.
Here are the stories we’re following this week:
- Fosamax and Statute of Limitations: Recent Fosamax case and application of American Pipe mass tort/class action tolling (HT: Drug and Device Law Blog)
- Drug Pushers: Are sales reps who promote their companies drugs with direct-to-consumer (DTC) advertising “pushers?” (HT: Pharma Marketing Blog)
- Anemia Drugs: Anemia drugs by Johnson & Johnson and Amgen may exacerbate heart problems and survival in kidney patients (HT: FiercePharma)
- Price-fixing: According to a Bloomberg report, Germany cuts costs of drugs by precluding manufacturers from setting their own prices.
- Neurontin: Reuters reports that Pfizer loses a RICO trial to the tune of $141 million.
- Boston Scientific Defibrillators: Another perspective here. You can see our previous blog post here.
- CT Scan Radiation: New York Times article about whether FDA ignored warnings about radiation problems.
Heart devices and the companies that manufacture them have had a rocky road the past few years (excluding Medtronic’s failed sprint fidelis leads: despite needlessly shocking patients, claims for injuries have been found by a federal trial court to be preempted). These include Guidant, which was subject recall and numerous lawsuits over its defibrillators because of a short-circuiting problem.
Now, Boston Scientific (which acquired Guidant in 2006) has voluntarily recalled all (non-implanted) implantable cardioverter defibrillators (ICDs) and cardiac resynchronization therapy defibrillators (CRT-Ds). An ICD is a device that monitors heart rhythms and delivers life-saving shocks if dangerous rhythms are detected. A CRT-D treats certain types of heart failure by coordinating the pumping of the heart’s ventricles. The units recalled fall under the COGNIS, CONFIENT, LIVIAN, PRZM, RENEWAL, TELIGEN and VITALITY lines.