Jury Awards $9 Billion Concluding Thirty-Four Day Actos Trial
A jury in Louisiana has ordered the Japanese drug manufacturer, Takeda Pharmaceutical, to pay $6 billion in punitive damages to plaintiffs Susan and Terrence Allen, over claims it was hiding cancer risks associated with diabetes drug Actos. Eli Lilly, a co-defendant in the case, was ordered to pay $3 billion in punitive damages. An indemnity provision in Takeda’s and Eli Lilly’s contract will most likely require Takeda to indemnify Eli Lilly and, therefore, be on the hook for the entire multi-billion dollar verdict. The jury also awarded $1.5 million in compensatory damages to plaintiffs Susan and Terrence Allen.
Terrence Allen and his wife’s lawsuit alleged that Allen developed bladder cancer as a result of using Actos to treat diabetes between 2004 and 2011. Plaintiffs argued that Actos manufacturer Takeda failed to disclose the link between Actos and bladder cancer. Takeda claimed that Allen’s cancer was not caused by the drug, and that the company provided proper notification of Actos’ risks.
Just prior to the trial beginning on January 27, 2014, the Judge ruled that Takeda acted in “bad faith” and destroyed relevant evidence. According to the Judge, the drug maker put a litigation hold on documents and electronic data related to Actos in 2002, yet repeatedly destroyed emails and other documents with information about the drug over much of the next decade. Takeda admitted that it could not locate files compiled by 46 current and former employees. The employees in question were involved in the development, marketing and sale of Actos, including two directors of the company. The allegation was that various files were deleted from company computers after executives issued a letter to employees to specifically retain any material related to Actos. The Court concluded that “relevant evidence was deleted by Takeda after the duty to preserve such evidence arose”. The Judge held that plaintiffs could reveal Takeda’s improper actions to the jury. Thus plaintiffs’ first witness was an Actos employee, who testified about the company’s evidentiary misconduct.
According to Kenneth Greisman, general counsel for Takeda, Takeda and Eli Lilly officials said they would appeal the jury verdict, which may be the largest single award in U.S. history over a pharmaceutical drugmaker’s mishandling of a product. Mr. Greisman stated that “Takeda respectfully disagrees with the verdict and we intend to vigorously challenge this outcome through all available legal means, including possible post-trial motions and an appeal.”
Takeda started selling Actos in the United States in 1999. United States drug manufacturer Eli Lilly and Takeda co-promoted Actos from 1999 to 2006. According to the lawsuit, Actos has generated more than $16 billion in sales since 1999. The U.S. Food and Drug Administration announced in 2011 that using Actos for more than one year could be associated with an increased risk of bladder cancer. The French and German governments banned the drug after the FDA’s announcement. In April 2012, Health Canada, the government drug safety agency for Canada, issued a safety warning on Actos. Diabetes patients prescribed Actos for over a year had two times higher risk of bladder cancer than diabetes patients not taking Actos.
As of March 13, 2014, there were 2,923 cases pending in the Actos Litigation in Louisiana. To date, at least three other Actos cases have been concluded. Two 2013 trials resulted in jury verdicts of $1.7 million and $6.5 million, although the verdicts ultimately were vacated. A third trial led to a decision in favor of Takeda. Another Actos trial is scheduled to start on April 14, 2014, before the same federal court.
