Justia Drugs & Biotech Opinion Summaries

This case involves a pharmaceutical manufacturer, Gilead Life Sciences, Inc., and its development and sale of a drug, tenofovir disoproxil fumarate (TDF), to treat HIV/AIDS. The approximately 24,000 plaintiffs allege that they suffered adverse effects from TDF, including skeletal and kidney damage. Gilead developed a similar but chemically distinct drug, tenofovir alafenamide fumarate (TAF), which could potentially treat HIV/AIDS with fewer side effects. The plaintiffs claim that Gilead delayed the development of TAF to maximize profits from TDF.The plaintiffs do not claim that TDF is defective. Instead, they assert a claim for ordinary negligence, arguing that Gilead's decision to delay the development of TAF breached its duty of reasonable care to users of TDF. They also assert a claim for fraudulent concealment, arguing that Gilead had a duty to disclose information about TAF to users of TDF.The Court of Appeal of the State of California, First Appellate District, Division Four, partially granted Gilead's petition for a writ of mandate and held that the plaintiffs could proceed with their negligence claim. The court concluded that a manufacturer's legal duty of reasonable care can extend beyond the duty not to market a defective product. However, the court reversed the trial court's decision denying Gilead's motion for summary adjudication of the plaintiffs' claim for fraudulent concealment. The court held that Gilead had no duty to disclose information about TAF to users of TDF, as TAF was not available as an alternative treatment at the time. View "Gilead Tenofovir Cases" on Justia Law

A case involving Lebanon County Employees' Retirement Fund and Teamsters Local 443 Health Services & Insurance Plan, as plaintiffs-appellants, and Steven H. Collis, Richard W. Gochnauer, Lon R. Greenberg, Jane E. Henney, M.D., Kathleen W. Hyle, Michael J. Long, Henry W. McGee, Ornella Barra, D. Mark Durcan, and Chris Zimmerman, as defendants-appellees, was heard by the Supreme Court of the State of Delaware. The plaintiffs, shareholders in AmerisourceBergen Corporation, brought a derivative complaint against the directors and officers of the Corporation alleging that they failed to adopt, implement, or oversee reasonable policies and practices to prevent the unlawful distribution of opioids. The plaintiffs claimed that this led to AmerisourceBergen incurring liability exceeding $6 billion in a 2021 global settlement related to the Company's role in the opioid epidemic. The Court of Chancery of the State of Delaware initially dismissed the complaint, basing its decision on a separate federal court finding that AmerisourceBergen had complied with its anti-diversion obligations under the Controlled Substances Act. However, the Supreme Court of the State of Delaware reversed the Court of Chancery's dismissal of the complaint, ruling that the lower court had erred in considering the federal court's findings as it changed the date at which demand futility should be considered and violated the principles of judicial notice. The case was remanded for further proceedings. View "Lebanon County Employees' Retirement Fund v. Collis" on Justia Law

Liposomal bupivacaine is a nonopioid pain medication that Pacira manufactures under the name EXPAREL; it is a local anesthetic administered at the time of surgery to control post-surgical pain. As of 2020, EXPAREL sales represented nearly all of Pacira’s total revenue. Pacira complains that the defendants, the American Society of Anesthesiologists, its journal, its editor, and authors published statements in a variety of forms, conveying their view that EXPAREL is “not superior” to standard analgesics or provides “inferior” pain relief.The Third Circuit affirmed the dismissal of Pacira’s suit for trade libel. Opinion statements are generally nonactionable. A “fair and natural” reading of the statements at issue shows that these are nonactionable subjective expressions. Pacira’s allegations boil down to disagreements about the reliability of the methodology and data underlying the statements; “a scientific conclusion based on nonfraudulent data in an academic publication is not a ‘fact’ that can be proven false through litigation.” Pacira failed to identify any aspect of the Articles, a Continuing Medical Education program, or a Podcast that “bring their conclusions outside the protected realm of scientific opinion.” View "Pacira Biosciences Inc v. American Society of Anesthesiologists Inc" on Justia Law

The First Circuit affirmed the judgment of the district court dismissing this complaint against Karoypharm Therapuetics, Inc. and its corporate officers (collectively, Defendants) alleging securities fraud in violation of sections 10(b) and 20(a) of the Securities Exchange Act, 15 U.S.C. 78j(b) and 78t(a), and Securities and Exchange Commission (SEC) Rule 10-b, 18 C.F.R. 240.10b-5, holding that the district court correctly dismissed the complaint for failure to state a claim.Plaintiff-investors brought this action following a decline in Karyopharm's stock price, alleging that Karyopharm materially misled them as to the safety and efficacy of the company's cancer-fighting drug candidate selinexor. The district court dismissed the complaint for failure to state a claim, concluding that Plaintiffs failed adequately to plead scienter with respect to Defendants' statements about a certain study of the drug as a treatment for pinta-refractory multiple myeloma. The First Circuit affirmed on other grounds, holding that Plaintiffs did not plausibly allege an actionable statement or omission with respect to the trial disclosures, and therefore, dismissal was appropriate. View "Thant v. Karyopharm Therapeutics Inc." on Justia Law

Quidel Corporation (Quidel) petitioned for a writ of mandate and/or prohibition to direct the trial court to vacate its order granting summary adjudication. Quidel contended the trial court incorrectly concluded a provision in its contract with Beckman Coulter, Inc. (Beckman) was an invalid restraint on trade in violation of Business and Professions Code, section 16600. Quidel argued the trial court improperly extended the holding from Edwards v. Arthur Andersen LLP, 44 Cal.4th 937 (2008) beyond the employment context to a provision in the parties’ 2003 BNP Assay Agreement (the Agreement). In its original, published opinion, the Court of Appeal concluded it was not, granted the petition and issued a writ instructing the trial court to vacate the December 2018 order granting summary judgment on the first cause of action. The California Supreme Court then granted review of the Court of Appeal's opinion and ordered briefing deferred pending its decision in Ixchel Pharma, LLC v. Biogen, Inc., S256927. On August 3, 2020, the Supreme Court issued Ixchel Pharma, LLC v. Biogen, Inc., 9 Cal.5th 1130 (2020), which held “a rule of reason applies to determine the validity of a contractual provision by which a business is restrained from engaging in a lawful trade or business with another business.” The Quidel matter was transferred back to the Court of Appeals with directions to vacate its previous opinion and reconsider the case in light of Ixchel. The appellate court issued a new opinion in which it concluded the trial court’s decision was incorrect. The trial court was directed to vacate the December 7, 2018 order granting summary adjudication on the first cause of action. View "Quidel Corporation v. Super. Ct." on Justia Law

Granny Purps grows and provides medical marijuana to its 20,000 members, in compliance with state laws governing the production and distribution of marijuana for medical purposes. Santa Cruz County’s ordinance prohibits any medical cannabis operation from cultivating more than 99 plants; Granny’s dispensary was growing thousands of marijuana plants. The sheriff’s office went to the dispensary in June 2015, seized about 1,800 plants, and issued a notice of ordinance violation. Several months later, officers again went to the dispensary and took about 400 more marijuana plants. Granny sued, alleging conversion, trespass, and inverse condemnation and sought an order requiring the county to return the seized cannabis plants, The trial court dismissed.The court of appeal reversed. A government entity does not have to return seized property if the property itself is illegal but the Santa Cruz ordinance ultimately regulates land use within the county; it does not (nor could it) render illegal a substance that is legal under state law. View "Granny Purps, Inc. v. County of Santa Cruz" on Justia Law

Quidel Corporation (Quidel) petitioned for a writ of mandate and/or prohibition to direct the trial court to vacate its order granting summary judgment. Quidel contended the trial court incorrectly concluded a provision in its contract with Beckman Coulter, Inc. (Beckman) was an invalid restraint on trade in violation of Business and Professions Code section 16600. In 1996, Biosite Inc. (Biosite; Quidel is the successor in interest to Biosite) licensed patent rights and know-how related to a B-type natriuretic peptide (BNP), which can be measured in a person's blood. The semi-exclusive licensing agreement allowed Biosite to develop an immunoassay to determine the level of BNP in a person's blood sample, to help diagnose congestive heart failure. After acquiring the intellectual property rights and know-how, Biosite developed and created a BNP assay for use with its point-of-care analyzer device, and it obtained regulatory approval. By 2003, Beckman had developed a laboratory analyzer, but it did not have a license for a BNP assay compatible with its analyzer. Around this same time, other companies were also pursuing BNP assays for use with their larger analyzers, which could run multiple, different immunoassays at higher volumes than the point-of-care analyzer Biosite had. Collaborating would mean Biosite could expand its customer base to those who wanted to use the larger capacity laboratory analyzers and Beckman could include the BNP assay in its menu of immunoassay offerings. Biosite and Beckman negotiated the Agreement over several months, and they exchanged numerous drafts before executing it. The Agreement prohibited Biosite from engaging other manufacturers to provide the BNP assay for their competing lab analyzers. The term of the Agreement was negotiated to coincide with the term of a related licensing agreement Biosite had with another company, Scios. Section 5.2.3 of the Agreement prohibited Beckman from researching or developing an assay that detected the presence or absence of the BNP or NT-proBNP proteins or markers for use in diagnosing cardiac disease until two years before the Agreement's expiration. Beckman sued Quidel for declaratory relief for violation of section 16600 and violation of the Cartwright Act, asking the Court to declare section 5.2.3 of the Agreement was void and unenforceable and to issue a permanent injunction preventing the enforcement of section 5.2.3 of the Agreement. Quidel argued the trial court improperly extended the holding from Edwards v. Arthur Andersen LLP, 44 Cal.4th 937 (2008) beyond the employment context to section 5.2.3 of the Agreement. The Court of Appeal determined the trial court's per se application of section 16600 to section 5.2.3 of the Agreement between Quidel and Beckman was not correct, granted Quidel’s petition and issued a writ instructing the trial court to vacate the December 7, 2018 order granting summary adjudication on the first cause of action. View "Quidel Corporation v. Super. Ct." on Justia Law

Shire manufactured and marketed the lucrative drug Vancocin, which is used to treat a life-threatening gastrointestinal infection. After Shire learned that manufacturers were considering making generic equivalents to Vancocin, it inundated the Food and Drug Administration (FDA) with allegedly meritless filings to delay approval of those generics. The FDA eventually rejected Shire’s filings and approved generic equivalents to Vancocin. The filings resulted in a high cost to consumers. Shire had delayed generic entry for years and reaped hundreds of millions of dollars in profits. Nearly five years later, after Shire had divested itself of Vancocin, the Federal Trade Commission (FTC) filed suit against Shire under Section 13(b) of the Federal Trade Commission Act, 15 U.S.C. 53(b), seeking a permanent injunction and restitution, and alleging that Shire’s petitioning was an unfair method of competition. The district court dismissed, finding that the FTC’s allegations of long-past petitioning activity failed to satisfy Section 13(b)’s requirement that Shire “is violating” or “is about to violate” the law. The Third Circuit affirmed, rejecting “the FTC’s invitation to stretch Section 13(b) beyond its clear text.” The FTC admits that Shire is not currently violating the law and did not allege that Shire is about to violate the law. View "Federal Trade Commission v. Shire ViroPharma Inc" on Justia Law

Hi-Tech filed suit alleging that the label of a protein-powder supplement distributed by HBS misled customers about the quantity and quality of protein in each serving, violating both the Georgia Uniform Deceptive Trade Practices Act and the federal Lanham Act. The district court dismissed the complaint.The Eleventh Circuit affirmed the district court's dismissal of the state law claim because it was preempted by the Food, Drug, and Cosmetics Act (FDCA). However, the court reversed the district court's dismissal of the Lanham Act claim, and rejected HBS's arguments that the FDCA barred the claim under the Lanham Act. In this case, Hi-Tech's Lanham Act claim would only require a court to determine whether the protein-content representations on the HexaPro label were misleading to consumers in the context of the label's failure to specify the sources of the nitrogen measured by the federal test. Therefore, this inquiry would not require a court to interpret or apply the FDCA to determine whether or not the marketing of the supplement was deceptive. View "Hi-Tech Pharmaceuticals, Inc. v. HBS International Corp." on Justia Law

Arla, a Denmark-based global dairy conglomerate, launched a $30 million advertising campaign aimed at expanding its U.S. cheese sales, branded “Live Unprocessed.” The ads assure consumers that Arla cheese contains no “weird stuff” or “ingredients that you can’t pronounce,” particularly, no milk from cows treated with recombinant bovine somatotropin (“rbST”), an artificial growth hormone. The flagship ad implies that milk from rbST-treated cows is unwholesome. Narrated by a seven-year-old girl, the ad depicts rbST as a cartoon monster with razor-sharp horns. Elanco makes the only FDA-approved rbST supplement. Elanco sued, alleging that the ads contain false and misleading statements in violation of the Lanham Act. Elanco provided scientific literature documenting rbST’s safety, and evidence that a major cheese producer had decreased its demand for rbST in response to the ads. The Seventh Circuit affirmed the issuance of a preliminary injunction, rejecting arguments that Elanco failed to produce consumer surveys or other reliable evidence of actual consumer confusion and did not submit adequate evidence linking the ad campaign to decreased demand for its rbST. Consumer surveys or other “hard” evidence of actual consumer confusion are unnecessary at the preliminary-injunction stage. The evidence of causation is sufficient at this stage: the harm is easily traced because Elanco manufactures the only FDA-approved rbST. The injunction is sufficiently definite and adequately supported by the record and the judge’s findings. View "Eli Lilly and Co. v. Arla Foods USA, Inc." on Justia Law