Justia U.S. 1st Circuit Court of Appeals Opinion Summaries

Articles Posted in Drugs & Biotech
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Plaintiff filed filed a qui tam action against a corporation and its subsidiary, both of whom manufacture and market medical devices, alleging that Defendants violated the False Claims Act in selling two particular medical devices to hospitals that seek reimbursement from the federal government through, for example, the Center for Medicare and Medicaid Services. Through two subsequent amendments, both with permission of the court, Plaintiff added several defendants and retooled his claims. Plaintiff then requested leave to amend fourth amended complaint. The district court applied the “good cause” standard from Fed. R. Civ. P. 16(b) to that request and struck the amended complaint. The First Circuit originally held that the district court should have evaluated Plaintiff’s fourth amended complaint under the standard set forth in Fed. R. Civ. P. 15(a). On remand, the district court concluded that Plaintiff’s desired amendment failed under that standard. The First Circuit affirmed, holding that Plaintiff’s request for leave to file his fourth amended complaint was properly denied as futile because none of the claims in Plaintiff’s fourth amended complaint was adequately pled. View "D'Agostino v. EV3, Inc." on Justia Law

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Plaintiff brought a qui tam action against Takeda Pharmaceutical Company and its affiliates (collectively, Takeda) and Eli Lilly and Company (Eli Lilly) (collectively, Defendants) under the False Claims Act (FCA) and the False Claims Acts of several different states, alleging that Defendants engaged in an illegal marketing campaign for Actos, a brand name drug approved by the FDA for improving blood sugar control in adults with Type 2 diabetes, and used illegal kickbacks to support that campaign. Plaintiff further alleged that through this campaign, Defendants knowingly caused third parties to submit false reimbursement claims to government entities for off-label uses of Actos. The district court dismissed Plaintiff’s claims, concluding that Plaintiff had failed to plead his claims with the particularity required by Fed. R. Civ. P. 9(b). The First Circuit affirmed, holding (1) the district court correctly dismissed Plaintiff’s complaint under Rule 9(b); and (2) the district court similarly did not err when it dismissed Plaintiff’s state claims with prejudice. View "Lawton v. Takeda Pharmaceutical Co." on Justia Law

Posted in: Drugs & Biotech
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AstraZeneca, a drug manufacturer that owns the patents covering Nexium, a prescription heartburn medication, sued Ranbaxy for patent infringement after Ranbaxy announced that it sought to market a generic version of Nexium. The two companies reached a settlement agreement under which Ranbaxy agreed to delay the launch of its generic until a certain date in return for various promises from AstraZeneca. Plaintiffs - pharmaceutical retail outlets and certified classes of direct purchasers and end payers - filed suit, arguing that the terms of the settlement agreements violated federal antitrust laws and state analogues. The jury found that although Plaintiffs had proved an antitrust violation, Plaintiffs had not shown that they suffered an antitrust injury that entitled them to damages. The First Circuit affirmed, holding (1) the district court did not commit reversible error in its evidentiary rulings, the formulation of the special verdict form and jury instructions, or its judgment as a matter of law on overarching conspiracy; and (2) the jury verdict rendered harmless any error that may have occurred during the summary judgment proceedings. View "In re Nexium Antitrust Litigation" on Justia Law

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Xolair, an injected drug approved by the FDA for treating allergies, is co-promoted in the United States by Genentech, Inc. and Roche Holdings, Inc. (Genentech) and Novartis Pharmaceuticals Corp. and Novartis Corp. (Novartis). Relators brought qui tam actions against Genentech and Novartis under the False Claims Act (FCA) and related state statutes, alleging that Defendants caused healthcare providers to submit false claims to the government for reimbursement for Xolair. The district court dismissed the federal claims with prejudice and then declined to exercise jurisdiction over the state-law claims and dismissed those claims with prejudice. The First Circuit affirmed in part and vacated in part, holding that the district court (1) did not abuse its discretion in denying Relators’ motion to amend; (2) did not err in dismissing the federal claims with prejudice; and (3) erred in dismissing the pendant state-law claims with prejudice. Remanded. View "Garcia v. Novartis Pharms. Corp." on Justia Law

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Fabry Disease, a rare genetic disorder, leaves afflicted persons unable to synthesize a key enzyme that helps the body break down fats. Untreated, Fabry patients suffer progressively more severe symptoms, including pain in their extremities, gastrointestinal issues, vision and hearing losses, stroke, and heart and kidney failure, eventually leading to premature death. Researchers at the Mt. Sinai School of Medicine developed a method for producing a replacement enzyme, which effectively treats (but does not cure) Fabry. After patenting this method, Mt. Sinai granted an exclusive license to Genzyme, which became the sole producer of the replacement enzyme, "Fabrazyme," the only FDA-approved enzyme replacement therapy for the treatment of Fabry. Genzyme provided the drug to Fabry patients until 2009. After a virus was discovered in improperly cleaned equipment at the company's manufacturing facility, Genzyme reduced production, leading to a Fabrazyme shortage. The company began rationing. Despite setbacks in reestablishing production levels, in 2011 Genzyme diverted some Fabrazyme to the European market, allegedly because of competition Genzyme faced from an alternative enzyme replacement therapy approved only in Europe. Two class action complaints were consolidated and dismissed. The First Circuit affirmed in part, for lack of standing, noting “the utter failure of any plaintiff (other than Mooney) to plausibly allege that he or she suffered an injury in fact as a result of accelerated disease progression or receipt of a contaminated drug.” View "Hochendoner v. Genzyme Corp." on Justia Law

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Warner Chilcott, a brand-name drug manufacturer that owns the patent covering Loestrin 24 Fe, and Watson Pharmaceuticals, Inc., which sought to introduce a generic version of Loestrin 24, entered into a settlement agreement wherein Watson agreed to delay entry of its generic version of Loestrin 24 in exchange for favorable side deals. Thereafter, Lupin Pharmaceuticals, Inc. announced that it would introduce a generic version of Loestrin 24. Warner and Lupin settled on terms similar to those between Warner and Watson. Two putative classes of plaintiffs brought antitrust claims that the settlement agreements were violations of the Sherman Act and constituted illegal restrains on trade under FTC v. Actavis. At issue in this case was whether such settlement agreements are subject to federal antitrust scrutiny where they do not involve reverse payments in pure cash form. The district court dismissed, concluding that Actavis applies only to monetary reverse payments and that Plaintiffs had alleged the existence of non-cash reverse payments only. The First Circuit vacated and remanded, holding that the district court erred in determining that non-monetary reverse payments do not fall under the scope of Actavis. Remanded. View "In re Loestrin 24 FE Antitrust Litig." on Justia Law

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Plaintiff's doctor prescribed, for shoulder pain, sulindac, a non-steroid anti-inflammatory, under the brand-name Clinoril; her pharmacist dispensed generic sulindac. She developed a hypersensitivity reaction, toxic epidermal necrolysis, with which the outer skin layer on a patient's body has deteriorated, been burned off or turned into an open wound. Plaintiff spent 70 days at Massachusetts General Hospital, more than 50 in its burn unit, with 60-65 percent of her skin affected. Her "truly horrific" injuries include permanent near-blindness. Her claims against the manufacturer included breach of warranty, fraud, and negligence, and products liability claims: design defect, failure to warn, and manufacturing defect. By trial, the remaining theory of design defect was narrowed to a claim that sulindac's risks outweighed its benefits making it unreasonably dangerous to consumers, despite the FDA having never withdrawn its statutory "safe and effective" designation. A jury awarded $21.06 million in compensatory damages. The First Circuit affirmed, rejecting claims including that the district court misunderstood New Hampshire law on design defect claims; that such claims as to generic drugs are preempted under federal law; that causation was not proved; and that damages were excessive and required a new trial. .View "Bartlett v. Mut. Pharm. Co., Inc." on Justia Law

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Plaintiffs are a dissident group, within a larger class of medical patient consumers in a case alleging fraud in overcharging for the medication Lupron. The patients, along with insurers and private health care providers, obtained a $150 million settlement agreement that was approved by the district court, of which $40 million was allocated to consumers. That agreement provided that if there were unclaimed monies from the $40 million consumer settlement pool after full recovery to consumer plaintiffs, all unclaimed funds would go into a cy pres fund to be distributed at the discretion of the trial judge. Dissident plaintiffs appealed distribution of the $11.4 million cy pres fund to the Dana Farber/Harvard Cancer Center and the Prostate Cancer Foundation for work on the treatment of the diseases for which Lupron is prescribed. They have already recovered more than 100% of their actual damages. The First Circuit affirmed. After expressing concern about distribution of such funds by judges and adding an audit requirement, the court noted the importance of avoiding windfalls for plaintiffs who have already been fully compensated. View "Rohn v. Dana Farber/Harvard Cancer Ctr." on Justia Law

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Flying from Cairo to New York, a flight attendant thought plaintiff looked ill and recruited a second-year medical resident to perform an examination. The resident thought that plaintiff was suffering an ischemic stroke or transient ischemic attack. The pilot made an emergency landing and, less than two hours later, plaintiff was treated at a hospital. The hospital did not administer an intravenous shot of tissue plasminogen activator (t-PA), a form of thrombolytic therapy that dissolves clots, but is not appropriate for all patients. His condition deteriorated, then stabilized, and he was transferred for care in New York. The district court held a "Daubert" hearing in plaintiff's malpractice claim and two experts gave vastly different opinions about whether failure to administer t-PA caused plaintiff's injuries. The court held that the standard for causation was "more likely than not" and that Maine had not adopted the "lost chance" doctrine, excluded plaintiff's expert, and granted summary judgment for defendants. The First Circuit affirmed, holding that plaintiff failed to show causation.

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Plaintiff, engaged in treatment and disposal of regulated biomedical waste, had trouble with its shredder and obtained approval from the Puerto Rico Environmental Quality Board to use autoclaves. After a few years, an inspector recommended that plaintiff's facility be shut down and ordered a landfill to stop accepting plaintiff's waste. Unable to resolve the matter with EQB, plaintiff sought a federal court injunction. The injunctions were denied, but plaintiff resumed handling waste. When a second shredder broke, an inspector again ordered the landfill to stop accepting waste and rejected several proposals for dealing with accumulated waste. Plaintiff's suit alleges more favorable treatment of a competitor and other constitutional violations. The district court dismissed for failure to link allegations to any particular defendant. The First Circuit affirmed, finding failure to meet minimal pleading standards. The complaint failed the plausibility test "spectacularly."