Taking the “Product” Out of Product Liability: Litigation Risks and Business Implications of Innovator and Co-Promoter Liability

Abstract

PLAINTIFF files a lawsuit claiming that her use of a prescription medication caused her to sustain injuries. Brand Pharmaceuticals did not manufacture drug and therefore cannot be liable to Plaintiff, right? Not necessarily. Two emerging theories of so-called and liability, aim to hold a non-manufacturer responsible for injuries caused by another company's pharmaceutical product. Under innovator a pharmaceutical manufacturer may be liable for injuries caused by a competitor's generic version of its brand drug based on its supposed responsibility for drug's prescribing information. Under co-promoter a company that contracts to market another manufacturer's pharmaceutical product may be liable based solely on its marketing activities. This article explores theories underlying these novel sources of liability and proposes business strategies to consider that could help mitigate these emerging risks. I. Traditional Tort Doctrine Limits Product Liability to Manufacturer of Product. By asserting innovator and co-promoter plaintiffs are attempting to circumvent well-established tort law principles. It is axiomatic that [a] fundamental principle of traditional products liability law is that plaintiff must prove that defendant supplied product which caused (1) A plaintiff suing for alleged injuries from a pharmaceutical product (or medical device) must identify actual defendant that manufactured product she alleges injured her. (2) When advancing theories of innovator and co-promoter plaintiffs target defendants they acknowledge played no role in manufacturing or supplying drug that allegedly caused their injury. These theories require courts to suspend traditional tort law doctrines of causation and duty and have, for that reason, largely been rejected. However, discussed below, a handful of jurisdictions have viewed these theories more favorably. II. Innovator Liability Against Brand Manufacturers for Generic Drugs A. Background: Act, Wyeth v. Levine, and PLIVA v. Mensing The roots of innovator liability can be found in Drug Price Competition and Patent Term Restoration Act of 1984, commonly referred to Hatch-Waxman Act. (3) Designed to facilitate entrance of generic drugs into pharmaceuticals market, Act relaxed requirements for U.S. Food and Drug Administration (FDA) approval for those drugs. Instead of having to leap clinical hurdles original drug sponsor, generic manufacturers need only demonstrate that their product is the as an existing brand drug, meaning that it is bioequivalent to its brand counterpart and has active ingredient(s), route of administration, dosage form, and strength. (4) Other than routine information reflecting different manufacturer or distributor, generic drug also must have the same prescribing information, i.e. label, brand drug (i.e., reference listed drug) on which its approval was based. (5) This requirement of is key to two recent U.S. Supreme Court decisions addressing federal preemption that appear to have reinvigorated innovator liability arguments. In Wyeth v. Levine, Court held that FDA's approval of a brand drug's prescribing information did not preempt state-law failure-to-warn claims because brand manufacturer had discretion under FDA's changes being effected (CBE) regulation to unilaterally strengthen a drug warning. (6) Two years later, however, Court held in PLIVA, Inc. v. Mensing, that failure to warn claims against generic manufacturers were preempted because--due to Act's sameness requirement generic manufacturers cannot use CBE process to unilaterally change their labels. (7) In post-Hatch-Waxman age, approximately 80% of prescriptions are filled with generic pharmaceuticals. …