Prempro lawsuits: Pfizer hit with $103 million more in punitive damages

prempro-lawsuits-pfizer-hit-with-103-million-more-in-punitiveIt seems that for Pfizer (PFE), the saga of Prempro is just beginning. Barely a month after the world's largest pharmaceutical company lost a case related to Wyeth's Prempro hormone replacement therapy drug and was ordered to pay punitive damages on top of earlier compensatory damages, it lost the second pending case in the matter in Philadelphia on Monday.

Initially, Pfizer was ordered in September to pay $3.75 million in compensatory damages. The punitive damages amount awarded a month later was sealed pending another verdict in a second similar case in the same courthouse. On Monday, the court revealed that Pfizer has been ordered to pay a total of $103 million in punitive damages in the two cases. The jury found the hormone drugs the two plaintiffs used for years contributed to their breast cancer. Including three other cases, so far Pfizer has been ordered to pay $165 million in punitive damages.
In the first case, the unsealed damages were $75 million. In the second case, the jury awarded Donna Kendall of Decatur, Ill., $6.3 million in compensatory damages and $28 million in punitive damages. Kendall took the hormone replacement drug for 11 years before she was diagnosed with breast cancer.

The Tip of the Liability Iceberg

These are just two of more than 10,000 Prempro lawsuits across the country. About 1,500 are pending in Philadelphia alone, opening up the door to far more potential liabilities for Pfizer, which recently was ordered to pay a record $2.3 billion fine for illegally marketing the painkiller Bextra, which is now off the market.

Analysts, though, aren't concerned, according to the The New York Times. They will start worrying only if the punitive damages awards are upheld on appeal. For now, they find it significant the drugs are still approved by the Food and Drug Administration. But lawyers think they're gaining legal ground, saying this is just the tip of the iceberg.

Pfizer, which inherited these problems when it purchased Wyeth for $68 billion this year and Pharmacia in 2002, of course said it would appeal the Philadelphia decisions.

Questionable Behavior

"We believe that neither the awards of punitive damages nor the liability verdicts were supported by the evidence or the law," said Pfizer spokesman Chris Loder. "We stand by our belief that our subsidiaries acted responsibly by providing proper and accurate warnings regarding the hormone therapy medicines' risks, performing and supporting studies on the known and potential benefits and risks of hormone therapy, and keeping the U.S. Food and Drug Administration fully informed."

Hormone replacement therapies, used to treat the symptoms of menopause, have been in use for years. In 2002, a major government study linked the therapies to increased breast cancer and cardiovascular risks. Sales of the drugs have plummeted since then. The question is, how much did the companies know about the risk?

According to reports, the jurors heard testimony that Wyeth paid consultants and ghostwriters of medical journal articles to downplay concerns about breast cancer, as well as testimony that Pharmacia did not study known risks. Jurors found the evidence showed that the companies had clearly put profits over safety.

Echoes of Merck's Vioxx

Unlike Merck's (MRK) Vioxx painkiller, hormone replacement therapy drugs are still in use today, although they are marketed with a black-box warning about the risks. Vioxx, which was linked to heart attacks and strokes, was removed from the market.

Meanwhile, a new analysis published in the Archives of Internal Medicine found that the increased cardiovascular risk associated with Vioxx could have been discovered as early as December 2000, nearly three and a half years before Merck's voluntary market withdrawal of the drug. The evidence was there and the FDA's concerns were there, but they all got drowned out by the company's marketing efforts. In response, Merck said it believes the analysis "used unreliable methods and reached incorrect conclusions."

It seems Vioxx is still haunting Merck, even after it has resolved most of the roughly 10,000 personal-injury lawsuits it faced through a $4.85 billion settlement reached in 2007.

To What End?

It seems despite large the fines levied against them and the expensive settlements they are compelled to agree to, nothing that has yet been tried is making a difference in drug companies' marketing practices -- direct to consumers, to doctors (including kickbacks) or online -- nor in practices such as paying for ghostwritten journal articles and hiding unfavorable outcomes.

How can so many drug companies so often be found to be so unethical? Is it the lack of proper regulatory oversight? If Wall Street corruption is mind-boggling, the issues of the pharmaceutical industry are equally so.

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