Last week, AstraZeneca agreed to pay $68.5 million to 36 states and the District of Columbia to resolve litigation charging the drugmaker with illegally marketing its Seroquel antipsychotic, failing to sufficiently disclose potential side effects and withholding negative safety and effectivness info (back story). But seven states were not among them, including South Carolina, which has a pending lawsuit against the drugmaker. Now, though, AstraZeneca has filed a counterclaim.
The drugmaker alleges Attorney General Alan Wilson is violating its constitutional due process rights by prosecuting a "law enforcement action akin to a criminal proceeding" dressed up as a civil suit, The National Law Journal writes. And AstraZeneca accuses him of reaching an "unlawful" agreement to split a potentially "staggering" contingency fee among three private lawyers and his office (here is the state-court lawsuit).
"The underlying litigation, as it now stands, is an orchestrated plan by Attorney General Wilson and private counsel to seek the maximum penalty - in the absence of any actual deception...or actual harm from AstraZeneca's actions," the lawsuit charges. "Moreover, the Attorney General and private counsel now have created an enterprise whereby they will jointly attempt to exploit the Attorney General's law enforcement authority, so they can both profit on a massive contingency fee."
In making its charge, AstraZeneca points to a 2009 amendment to a fee agreement with three plaintiffs lawyers - Ken Bailey of Bailey Perrin Bailey; John Simmons of the Simmons Law Firm, and John Belton White Jr. of Harrison, White, Smith & Coggins - who get up to 23 percent of any penalties awarded to the state under the South Carolina Unfair Trade Practices Act. The AG's office would get 10 percent. "Both the Attorney General's and private counsel's financial interest in the 'successful' prosecution of claims against AstraZeneca could be staggeringly high," the suit states.
South Carolina filed its lawsuit against AstraZeneca in 2009 in hopes of recovering funds spent to treat Seroquel side-effects and for reimbursements for alleged off-label uses, the paper points out. Wilson's predecessor amended the lawsuit and dismissed every claim, except for penalties for alleged false statements in Seroquel labeling. The drugmaker maintains the state amended its fee agreement to delete a previous provision strictly limiting recovery to the lawyers to actual damages (here are the lawsuit against AstraZeneca and the fee agreements).