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Bernstein Liebhard Liftshitz, LLP
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Pharmaceutical & Health Care-Related Fund Litigation
Union health and welfare funds, private and governmental insurers and state run Medicaid programs – typically referred to as third-party payors – spend billions of dollars each year on pharmaceutical drugs and medical devices for covered persons. Drug companies such as Merck market blockbuster drugs like Vioxx and Vytorin as safe and effective. Unfortunately, as is too often the case, drug and device companies later disclose to consumers and third-party payors that the drugs and devices are far less safe and effective than advertised. And, as with Vioxx for example, there is often evidence that the companies knew about the problems with the products long before they disclosed them to consumers and welfare funds who bought the products for their members. For these types of frauds, third party payors have remedies under state common law, state consumer fraud statutes and federal and state antitrust laws to recover monies they overpaid for drugs and devices. Under some statutes, in addition to recovering out-of-pocket losses, funds may recover attorney fees, costs and triple damages. At BL&L, we assist third party payors in recovering lost monies. We monitor our clients’ approved drug and medical device lists and counsel clients on whether they should bring third-party payor actions against the pharmaceutical and medical device companies that defraud the funds.
In addition to pursuing cases where third-party payors are overcharged for unsafe and ineffective drugs that should not have been sold in the first place, BL&L also pursues cases for clients against manufacturers and health-care related entities for:
- Causing funds to pay for medical procedures for members who are injured by defective drugs;
- Misrepresenting the price pharmaceutical benefits managers pay for drugs;
- Selling and failing to recall defective medical devices;
- Engaging in illegal conspiracies and kickback schemes in violation of federal and state antitrust laws that drive up drug prices; and
- Filing “sham” patent lawsuits to prevent price competition from generic drug manufacturers, which cause drug prices to remain artificially high.
The Firm currently represents union health and welfare funds, including the health and welfare funds for the Detectives Endowment Association of the City of New York Police Department and the Ohio Carpenters, in a lawsuit against Merck in New Jersey state court. The lawsuit, spearheaded by Partner Eric Chaffin, claims that Merck violated the NJ Consumer Fraud Act by misrepresenting Vioxx’s safety and effectiveness, thereby inducing union health and welfare funds to overpay for Vioxx. Financial analysts have estimated that the losses to insurance plans, including union common benefit funds, from Vioxx is over $8 billion.
In August 2008, BL&L’s Supreme Court and Appellate Practice team filed an amicus curiae brief for firm clients with the U.S. Supreme Court in support of the plaintiff in Wyeth v. Levine – which will decide whether FDA regulations preempt (that is, preclude) consumer lawsuits for injuries caused by defective pharmaceutical drugs. This issue is critically important to union members, and also to health and welfare funds that, without recourse against the drug companies, are left paying for the medical expenses and costs associated with the use of defective pharmaceuticals and medical devices.
To request more information about our health care-related fund litigation, please contact Eric Chaffin.
