Supreme Court

Supreme Court to consider 'pre-emption' for drug companies

Anne Zieger — Fri, 19 Sep 2008 13:40:51 -0400

Diane Levine, who lost part of her right arm after a medical mistake, was awarded $6 million by a Vermont jury in her suit against Wyeth. In her case, she contended that the catastrophe that took part of her arm, the misuse of Wyatt drug Phenergan, might have been avoided if Wyeth had adequately warned her about the risks of using the drug.

Now, however, the Supreme Court could throw the Vermont judgment out. Levine has been caught up the battle over "pre-emption," the notion that plaintiffs shouldn't be allowed to bring cases in state court if a product meets federal standards. Advocates of pre-emption argue that since the label on the Phenergan administered to Levine had been approved by the the FDA, she shouldn't be allowed to sue. But Levine argues that Wyeth should be held responsible for not offering a warning on the risks associated with IV push, which caused the gangrene that destroyed her arm when it was incorrectly done on an artery.

Wyeth--and other drug and devicemakers who have taken on similar cases--argue that they couldn't change the label to comply with Vermont law, or they'd violate federal law. Levine and her lawyers, meanwhile, argue that the tougher warning is allowed and that federal law just sets a minimum.

Now, the Supreme Court will examine, for this case at least, whether the federal standards were enough. The resulting decision, attorneys say, could turn out to be one of the most important of the current term.

To learn more about the case:
- read this piece from the New York Times

Related Articles:
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Federal False Claims act uses narrowed, but legislators still want expansion

Anne Zieger — Mon, 21 Jul 2008 13:22:23 -0400

Things should get interesting in coming months when it comes to the application of the False Claims Act. On the one hand, the U.S. Supreme Court recently narrowed the application of the Act--but meanwhile, legislators continue to look at options for expanding the government's False Claims powers.

In the June decision, the Supremes settled a squabble over whether contractors who don't bill the government directly, but instead go through another entity that contracts with the U.S., can be held liable under the False Claims Act for fraudulently-obtained funds. The court said that contractors could, but only if they intended to defraud the U.S. itself, and that the alleged false statements influenced the government's decision to pay the claim. Some legal analysts argue that the decision makes it harder for physician whistle-blowers to prove cases using the False Claims statute, such as allegations of illegal off-label marketing by pharmaceutical companies. Others note that it will help weed out weak cases and offer extra defense to physicians sued under the statute.

Legislators, meanwhile, had a different outcome in mind. A bill pending on the Hill, the False Claims Correction Act, would remove rules against whistle-blower claims being brought on the basis of publicly-disclosed information or claims lacking specific proof. The government could dismiss such claims, but right now defendants can ask that the judge do so.

To learn more about these trends:
- read this AMNews piece

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AstraZeneca asks judge to nullify $215M drug-price lawsuit

Thu, 12 Jun 2008 06:59:56 -0400

Drugmaker AstraZeneca has asked an Alabama judge to nullify a jury verdict that ordered it to pay the state $215 million in damages in a Medicaid drug-price fraud suit. The state's 2005 suit accused the pharma with overcharging Medicaid by inflating drug prices. The jury awarded the judgment in February, but AstraZeneca appealed, saying that the state's attorneys hadn't proved their case, and had also violated a state law capping punitive damages. If the current judge doesn't throw out the verdict, the firm will appeal the judgment to the state's Supreme Court.

To learn more about the case:
- read this Modern Healthcare article (reg. req.)

Related Article:
Drugmakers cut deals in price-inflation lawsuit

Hospitals win back $666M from Medicare

Thu, 13 Mar 2008 07:59:58 -0400

In a deal that marks one of the largest settlements ever paid by the federal government to healthcare providers, CMS has agreed to pay out $666 million to 667 hospitals that sued for back payments. The dispute dates back to shifts in Medicare reimbursement policies from the 1980s. In 1986, the Reagan administration changed reimbursement rules to exclude some low-income patients from disproportionate-share payment calculations. A number of hospitals sued to have the rule changed, and succeeded in 1997. Following the reversal, one hospital sued for back payments for treatment in the 1990s, and eventually attracted a total of 667 hospitals seeking reimbursement as well--most of which were nonprofits treating largely the poor. The hospitals won in federal court, and the federal government lost its appeal, then got rejected for a hearing by the Supreme Court.

To learn more about the case:
- read this piece from The Wall Street Journal (sub. req.)
- read this Modern Healthcare article (reg. req.)

Related Articles:
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Florida expands patient access to medical records

Mon, 10 Mar 2008 07:59:56 -0400

A Florida state Supreme Court decision has given patients access to medical error and incident reports prepared by providers, overturning legislation that had limited such access. As things stood in Florida, patients had access to a wide range of records compiled by providers, including documents created for or by peer review committees, which were created prior to Nov. 2, 2004, the date when a state constitutional amendment opening such access was created. However, after that date the Florida legislature created laws limiting such access.

Now, the state Supremes have said that the law limiting access violated the constitutional amendment voted in by consumers. The court not only gave patients access to documents created after the amendment, but also those created before it was enacted. The Florida Hospital Association is not thrilled by this, of course. No word whether they or other providers intend to fight the ruling further.

To learn more about the decision:
- read this Modern Healthcare piece (reg. req.)

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