How to make a big profit in this recession
Mar/05/09 13:25 Filed in: Pharmaceuticals | Medical products
I got your attention, didn’t I? You thought I was going to write a tome on how to make money in the medical industry. Well, if you go to college, get an MBA, take a sales position in medical products, learn the ropes, move into middle management, introduce a few big products to the market, get promoted to VP-level, and work hard–if you do all of that, you can do well in this industry.
Oh, you want the easy way. Then, get a law degree and sue a drug or medical device manufacturer because a physician used the product exactly according to its label, which was approved by the FDA before it was released to the market. No, seriously, the Supreme Court just ruled in Wyeth v. Levine that you could do that. (Since I’m going to be discussing this ruling, and no one wants to read an 80 page legal document, the New York Times provides an analysis of it.)
Just to review, Diana Levine, who was suffering from migraines, visited a medical clinic in Vermont. At first she was given injections of Demerol (pethidine) for pain and Phenergan (promethazine, Wyeth) for nausea. Generally, Phenergan is administered by intramuscular (IM) injection or through an intravenous (IV) line, because if the drug is exposed to arterial blood, it can cause severe gangrene at the area of injection. A physician assistant (PA) administered the drug by IV-push, directly into what the PA thought was vein, but was actually an artery. Within weeks, Levine’s hand and forearm became necrotic and were amputated in two stages.
Ms. Levine eventually sued Wyeth in Vermont, arguing that first, Wyeth should have placed stronger warning language about the risks of delivering the drug into an artery, and second, that Wyeth should have known the dangers of IV push, and contraindicated Phenergan for that delivery method. Eventually, she won a $6.7 million verdict. The Vermont Supreme Court affirmed the verdict, which usually would end the story. However, Wyeth then appealed to the US Supreme Court stating that Federal Law, in this case the FDA approving the use of Phenergan with appropriate labeling, pre-empted Levine’s claims in state court. The Supreme Court affirmed the Vermont ruling by a 6-3 vote.
Essentially, the court ruled that state juries can award damages for the use of drugs that cause harm, even if the manufacturer of the drug met the standards set by the FDA. In other words, lay juries, who may or may not have any scientific or medical knowledge, are allowed to evaluate the medical accuracy of FDA approved package inserts. I don’t know how many of you have ever been involved with the writing of package inserts, but I have, many times. It is written by the best clinical talent in a company, it is reviewed by the medical director and his staff, and it is then once again read, critiqued and approved by the FDA. Some of the leading experts, from pharmacology to physiology, in the development of the drug are involved in this process. In general, these people are ethical, intelligent, and, to the frustration of every marketing person in the industry, extraordinarily careful.
Phenergan has been delivered over 200 million times over the past 50 years or so. There is about a 1 in 20,000,000 risk of an adverse reaction of gangrene. Wyeth did everything it could to warn about that extremely small risk.
Every drug has a risk. Every procedure has a risk. The physician’s assistant made a terrible error with tragic consequences for Ms. Levine. I am extremely empathetic to what happened to her, and I’m not sure what I’d do if I lost my arm. But Wyeth did everything within the law to provide the best information to clinicians, up to and including huge boxed warnings on the package insert. When it comes to litigation, Wyeth has the deep pockets and the PA did not.
The consequences of this ruling are huge. The FDA, continually understaffed, will have to review every possible nuance in labeling to make certain that warnings are taken seriously by health care workers. Companies that develop and market drugs are now going to have to wonder if a minor risk will end up being a lawsuit. Access to drugs, all of which carry inherent risk, may be restricted, or become more expensive.
If a company acts in an unethical manner, covering up evidence of negligence, and then harms patients ought to be run out of business. The chain of command that makes those decisions should be treated in the same manner as any other criminal. But Wyeth did everything it could to warn of the risk.
When I was at Johnson and Johnson, I was in a meeting with our corporate legal staff discussing final labeling for an important therapeutic product. The attorney said, “don’t assume that a jury reading this label is going to agree with what you think it’s going to say. They don’t know and they don’t care.”
By Michael W Simpson
Oh, you want the easy way. Then, get a law degree and sue a drug or medical device manufacturer because a physician used the product exactly according to its label, which was approved by the FDA before it was released to the market. No, seriously, the Supreme Court just ruled in Wyeth v. Levine that you could do that. (Since I’m going to be discussing this ruling, and no one wants to read an 80 page legal document, the New York Times provides an analysis of it.)
Just to review, Diana Levine, who was suffering from migraines, visited a medical clinic in Vermont. At first she was given injections of Demerol (pethidine) for pain and Phenergan (promethazine, Wyeth) for nausea. Generally, Phenergan is administered by intramuscular (IM) injection or through an intravenous (IV) line, because if the drug is exposed to arterial blood, it can cause severe gangrene at the area of injection. A physician assistant (PA) administered the drug by IV-push, directly into what the PA thought was vein, but was actually an artery. Within weeks, Levine’s hand and forearm became necrotic and were amputated in two stages.
Ms. Levine eventually sued Wyeth in Vermont, arguing that first, Wyeth should have placed stronger warning language about the risks of delivering the drug into an artery, and second, that Wyeth should have known the dangers of IV push, and contraindicated Phenergan for that delivery method. Eventually, she won a $6.7 million verdict. The Vermont Supreme Court affirmed the verdict, which usually would end the story. However, Wyeth then appealed to the US Supreme Court stating that Federal Law, in this case the FDA approving the use of Phenergan with appropriate labeling, pre-empted Levine’s claims in state court. The Supreme Court affirmed the Vermont ruling by a 6-3 vote.
Essentially, the court ruled that state juries can award damages for the use of drugs that cause harm, even if the manufacturer of the drug met the standards set by the FDA. In other words, lay juries, who may or may not have any scientific or medical knowledge, are allowed to evaluate the medical accuracy of FDA approved package inserts. I don’t know how many of you have ever been involved with the writing of package inserts, but I have, many times. It is written by the best clinical talent in a company, it is reviewed by the medical director and his staff, and it is then once again read, critiqued and approved by the FDA. Some of the leading experts, from pharmacology to physiology, in the development of the drug are involved in this process. In general, these people are ethical, intelligent, and, to the frustration of every marketing person in the industry, extraordinarily careful.
Phenergan has been delivered over 200 million times over the past 50 years or so. There is about a 1 in 20,000,000 risk of an adverse reaction of gangrene. Wyeth did everything it could to warn about that extremely small risk.
Every drug has a risk. Every procedure has a risk. The physician’s assistant made a terrible error with tragic consequences for Ms. Levine. I am extremely empathetic to what happened to her, and I’m not sure what I’d do if I lost my arm. But Wyeth did everything within the law to provide the best information to clinicians, up to and including huge boxed warnings on the package insert. When it comes to litigation, Wyeth has the deep pockets and the PA did not.
The consequences of this ruling are huge. The FDA, continually understaffed, will have to review every possible nuance in labeling to make certain that warnings are taken seriously by health care workers. Companies that develop and market drugs are now going to have to wonder if a minor risk will end up being a lawsuit. Access to drugs, all of which carry inherent risk, may be restricted, or become more expensive.
If a company acts in an unethical manner, covering up evidence of negligence, and then harms patients ought to be run out of business. The chain of command that makes those decisions should be treated in the same manner as any other criminal. But Wyeth did everything it could to warn of the risk.
When I was at Johnson and Johnson, I was in a meeting with our corporate legal staff discussing final labeling for an important therapeutic product. The attorney said, “don’t assume that a jury reading this label is going to agree with what you think it’s going to say. They don’t know and they don’t care.”
By Michael W Simpson