Blue Cross and Blue Shield of Massachusetts Inc. has filed a number of subrogation actions in the Louisiana multidistrict litigation (MDL) over the bladder cancer risks carried by Takeda Pharmaceuticals Co. Ltd. and Eli Lilly & Co.’s diabetes drug Actos. The company seeks to recoup the cost of medical bills for hundreds of alleged victims. Standing in the shoes of its insureds, Blue Cross and its subsidiary Blue Cross and Blue Shield of Massachusetts HMO Blue Inc., filed more than 10 lawsuits asserting that Takeda and Eli Lilly should shoulder health coverage payouts surrounding its subrogees’ personal injuries.
It’s alleged in the lawsuit that the defendants — Asia’s largest pharmaceutical company and its Indianapolis-based marketing partner — negligently or fraudulently concealed the link between Actos and bladder cancer. The suit states:
By virtue of its payment for injuries sustained by an insured member as a direct result of the allegations herein, BCBSMA is subrogated to the rights of their insured members to recover from the person(s) or entity(ies) responsible for said injuries.
The complaints include claims for negligence, breach of express and implied warranties, fraud, misrepresentation, and violations of Massachusetts law. Blue Cross also requested that the MDL court send the cases back to Massachusetts federal court. Like the more than 6,000 personal injury cases pending together in the same court, Blue Cross is contending that before Takeda applied for approval from the U.S. Food and Drug Administration (FDA), it knew from the results of animal testing that Actos could cause bladder cancer.
When epidemiological studies in the 2000s reinforced the link, Takeda ignored the results and failed to alert consumers, regulators and the medical community about the dangers of taking Actos. The same Louisiana court recently oversaw the first federal jury decision in Actos product liability litigation, a $9 billion punitive verdict coupled with $1.5 million in actual damages to Plaintiffs Terrence and Susan Allen.
While the very large award is likely to be reduced at some point, it has already prompted a “public kerfuffle” between the two co-defendants over which is responsible for the $3 billion portion of the verdict that fell on Eli Lilly. Takeda developed Actos and partnered with Eli Lilly to promote the drug from 1999 to 2006. After the Allen verdict, Eli Lilly publicly said that Takeda is responsible for providing indemnification for the damages by virtue of the companies’ marketing contract. Takeda countered that it was reserving its rights to contest Eli Lilly’s claim.
The verdict was likely due in some measure to U.S. District Judge Rebecca Doherty’s devastating evidence destruction findings against Takeda. Those findings resulted in tough sanctions that allowed the jury to take into account the drugmaker’s apparent spoliation of relevant documents, emails and other evidence. The companies also face actions in state courts across the country.
Actos represented more than a quarter of Takeda’s total sales in 2011, at its peak. In June of that year, the FDA alerted the public that use of the drug for longer than a year could cause bladder cancer and discouraged doctors from prescribing it to patients with active bladder cancer. If you need more information on the Actos litigation, contact Andy Birchfield, the lawyer who heads up our firm’s Mass Torts Section, at 800-898-2034 or by email at Andy.Birchfield@beasleyallen.com.
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