Lieff Cabraser Civil Justice Blog

Public Justice and AAJ Contest Dismissal of Big-Pharma Fraud Case

Public Justice and AAJ Contest Dismissal of Big-Pharma Fraud Case

Public Justice (represented by Lieff Cabraser) and the American Association for Justice today filed an amicus brief in the U.S. Court of Appeals for the Second Circuit urging the reinstatement of civil RICO claims that Sanofi-Aventis profited from a scheme to market and sell its antibiotic Ketek by falsely representing the drug’s safety — and concealing its risk of severe liver damage — from the FDA, doctors, and purchasers.

Even though Ketek prescriptions and sales hit rock bottom when news of its dangerous side effects reached the medical community, the district court in the case held that doctors’ prescribing decisions broke the chain of causation as a matter of law. The amicus brief explains that this reasoning opens an indefensible gulf between the law of RICO and the common law, both of which require only that the alleged wrongful act be a substantial, foreseeable factor in causing the harm.

The FDA’s approval of Ketek based on bogus studies commissioned by the drug company substantially induced doctors to prescribe Ketek, the brief argues. And it was eminently foreseeable that this fraud would cause the proposed class of health care plans to pay for worthless prescriptions — the injury to business or property required by RICO. “A scheme to sell more pills by making false representations of safety directly injures those who pay for the pills,” the brief states.

The amici also note that an affirmance would create a circuit split with the First Circuit’s 2013 decisions allowing the Neurontin matter to proceed.

“Left to stand,” amici conclude, “the district court’s dismissal would remove a critical deterrent to wrongdoing that causes economic damage, exacerbates the high costs of our health care system, and creates the danger of severe physical injury.”