In a devastating blow to Novartis, a federal judge denied a bid to overturn a verdict in which a jury decided the drugmaker failed to adequately warn about the risks that its Zometa and Aredia bone-strengthening meds caused severe jaw bone damage. And in making his decision, he writes that the jury was shown sufficient evidence to conclude a cover-up was undertaken with "the knowledge and approval of high-ranking officials."
The ruling, which was issued yesterday, was made by US District Court Judge James Beaty and came almost exactly a year after a jury awarded $12.8 million to Rita Fussman, whose family claimed she suffered jawbone damage while she was dying of breast cancer in 2009. The jury awarded $287,000 in compensatory damages, as well as $12.6 million in punitive damages, which were reduced under North Carolina law. The final award was nearly $1.3 million.
Novartis, however, sought a new trial and argued, in part, that punitive damages were awarded incorrectly. But the move backfired. In his ruling, Beaty notes North Carolina law requires that, for a plaintiff to win punitive damages, a jury must be presented with clear and convincing evidence at trial to determine that officers, directors or managers of a company "participated in or condoned the conduct constituting the aggravating factor giving rise to punitive damage.”
And Beaty decided that such evidence was, indeed, presented to uphold the punitive damage award. In other words, Novartis execs are being fingered. The Fussman case, by the way, was the first from the multi-district litigation in federal courts to be tried and the only case, so far, where a plaintiff presented evidence for punitive damages. As a result, his order may have the potential to reverberate across the hundreds of other lawsuits that Novartis faces.
In case you wondering, Beaty was rather emphatic. For instance, he wrote that "...the willful and wanton conduct alleged in this case involved intentional deception and suppression of medical evidence by Novartis employees in investigating side effects and communicating with medical professionals."
"...based on the evidence presented, the court concludes that sufficient evidence was presented to support a finding by the jury, by clear and convincing evidence, that Novartis managers intentionally concealed the risk of ONJ (osteonecrosis of the jaw) and attempted to subvert the medical inquiry regarding the risks of ONJ, all with the knowledge and approval of high-ranking officials within the company. In addition, the evidence would support the conclusion that Novartis managers took this course of action for purely financial reasons, in order to protect its marketing of bisphosphonate drugs."
"Indeed, the evidence presented at trial against Novartis on this issue was of such sufficient strength that during closing arguments, counsel for Novartis felt compelled to concede that there was 'bad news' for Novartis because documents admitted during trial showed that Novartis managers had, in the words of defense counsel, engaged in 'improper' thinking, were 'less than perfect,' and had raised ideas of doing things that 'probably should not have been thought about' to prevent publication of or obscure medical evidence regarding risks of ONJ with Aredia and Zometa."
"In addition, there was sufficient evidence presented to support the jury’s conclusion that this intentional deception and suppression of medical evidence by Novartis was related to Mrs. Fussman’s jaw injuries, because the evidence was sufficient to support the finding that the actions by Novartis were undertaken as part of an effort to keep doctors and other medical professionals from learning of the ONJ risks, and it was this lack of adequate warning and information that the jury had already determined was the proximate cause of Mrs. Fussman’s injuries" (here is the complete ruling).
We have asked Novartis for a comment and will update you accordingly. [UPDATE: At 2 pm ET, a Novartis spokeswoman sent us this: “We are disappointed and disagree with the court’s decision. We believe that Zometa is an effective option for cancer patients with bone metastases and hypercalcemia of malignancy. We are reviewing our appellate options.”]
This is not the first time that Novartis has experienced a trying moment over the Zometa and Aredia litigation. Last year, the drugmaker was sanctioned by a federal court judge in Tennesse for denying that it ran direct-to-consumer ads for Zometa and, then, failing to produce those ads - which were later discovered independently by lawyers for a woman who claims the medication caused osteonecrosis. The drugmaker flip-flopped on the existence of the ads in different motions and was recently ordered to pay about $50,000 in attorneys fees (back story).
So far, four cases have gone to trial over the Novartis drugs. Earlier this month, a federal court judge has dismissed a lawsuit. A New Jersey jury rejected claims by a woman who similarly charged the meds caused her jaw damage (see this). And two years ago, a Montana jury ordered Novartis to pay $3.2 million in damages to a cancer patient who made the same claims (back story). This same dispute, by the way, plagues Merck, which last month won a trial involving its Fosamax med (see here).
5 Comments
What is worse, A company that covers up a drug's dangers for the sake of the almighty dollar, Or that same company getting away with their illegal actions?
Congrats to this judge for calling this company and it's upper mgt. out for their most obvious infractions and cover-up.
As Ed points out this is not the first time this company has tried to hide, conceal, or otherwise cover-up their actions against the American patient.
If I were a judge hearing any case with the Novartis name attatched, I would be highly suspect of the counsel, their upper execs, or any representative from that company.
Too often these crimes are reported then forgotten, when in reality these types of repeated offenses are more indicative of a deeper, more insideous pattern of a company's true moral compass... and as in this case any many more that seem to involve this company, the compass points South! And I'm not talking Florida, but it IS hot there!
That was an incredible story. I thought Novartis might be one of the cleaner companies but this shnged my mind. I don't see how individuals can work for virtually any of these companies. It does seem they do nt last very long f they have any eithics at all.
If Basel knows any pharma co this is the one. Stay away from them and if you still work for them, it is a gold mind for evidence of misconduct, so collect it and do the right thing;take it outside to either DOJ or hire your own law team and do it. By the way, those wonderful comanies that were destroyed by merger into Novartis, were the clean and noble entities. Novartis with its new breed of management and new approach to doing biz (by the way Novartis means new way of doing things) put a stop to this. Whole Switzerland's population is still reeling from shock what this once great co has become.
Let's hope Switzerland shares its thoughtful insights about the dark side of global medicine with everyone else.
Investors have to share some of the blame, no? Was their line in the sand for profit-making clear?
Investors? Yes the nasty modern age investors in any biz that insist on such super high returns in such short terms like few months as opposed to few years in the past. This does not come from Swissland (easier to spell)but from USA and their investors and those who promise the investors their super high and fast returns. This pressure for super returns by investors and their enablers, like banks and brokerage houses, has lead to multiple negative outcomes, too many to mention or figure out. For instance, the misconduct by the bigpharma that ranges from offlabel promotion to cover-ups as in this case is also result of that pressure to meet those super expectations, the bigpharma had to resort to "alternative" practices that are illegal and often criminal.Never mind the unethical, that are used as easy as pie. Can we equate the pressure for super-returns with greed? Of course we can and that is the very root of cause that brought us where we are today. FYI: just this morning the CEO and Chair of Chrysler/FIAT Mr. Mangione, is quoated in major paper saying that the gross inequality we see all around the world, not only in poor countries but countries like USA, must be dealt with if we are to prevent near future disaster as result of this trend. He also said that he has seen so much unbelieavable GREED around the board room tables he set at that would not believe it if we did not see it for himself. What does it tell you? Who are the real culprits of greed and pressure that leads to investors' demands for super returns thus even criminal behaviours to achieve it.