A federal judge dismissed most of the state's lawsuit, calling Mississippi Attorney General Jim Hood's approach a "slash-and-burn style of litigation" that could bankrupt Lilly and pharma, in general. Hood (pictured at left) hoped to recover Medicaid payments made for Lilly's antipsychotic, which was allegedly marketed for off-label use while downplaying risks, such as weight gain and diabetes. The drugmaker paid $1.4 billion to settle federal civil and criminal claims over alleged off-label marketing.
In a 117-page order, US District Court Judge Jack Weinstein maintained Zyprexa offered benefits despite the side effect allegations. "The state arguably saved large sums through use of Zyprexa by preventing users with serious mental problems from requiring hospitalization in state facilities, and allowing them to become productive taxpayers and participants in the economy," he wrote.
He decided Mississippi failed to make its case for penalties, writing that the statistical analysis used by Hood's attorneys, the Houston law firm of Bailey Perrin Bailey, failed to show Lilly harmed the state's Medicaid program. More than 40 states have sued Lilly, but Mississippi is the first to incur a setback, The Legal Newsline notes. However, Weinstein didn't dismiss the entire case - Mississippi can still attempt to prove Lilly charged the state more than Zyprexa was worth.
"If allowed to proceed in their entirety, the state's claims could result in serious harm or bankruptcy for this defendant and the pharmaceutical industry generally," he wrote. "For the legal system to be used for this slash-and-burn style of litigation would arguably constitute an abuse of the legal process. Constitutional, statutory and common law rights of those injured to seek relief from the courts must be recognized. But courts cannot be used as an engine of an industry's destruction."
Of the 12 states that did not settle their lawsuits against Lilly in a 33-state, $62-million agreement, five have already made their settlements official and others have tentative agreements, Legal Newsline reminds us. Those that settled include Connecticut; West Virginia; Idaho; Utah and South Carolina. Meanwhile, Montana, Minnesota, New Mexico and Louisiana have reached deals that have not been finalized. Lilly is apparently in talks with Arkansas, Pennsylvania and Louisiana.