Mass Torts Update - Tuesday, October 7, 2008 9:25 - 1 Comment

Lilly Zyprexa group buyers win class action status

A federal judge in Brooklyn, New York, ruled recently that pension funds, labor unions and insurance companies that bought Eli Lilly & Co’s Zyprexa drug could sue as a group and were entitled to a jury trial of claims the medicine was overpriced. As we have reported, Zyprexa is approved to treat schizophrenia and bipolar disorder. The Plaintiffs claim Lilly urged doctors to prescribe Zyprexa for uses not approved by the FDA. The institutional buyers, who sought $6.8 billion in damages, claim Lilly overpriced the drug by making excessive claims about Zyprexa’s usefulness, violating the Racketeer-Influenced and Corrupt Organizations Act, or RICO. The judge found “sufficient evidence of fraud” by Lilly in selling the drug to justify a jury trial. The judge certified the case as a class action on the RICO claims for all Plaintiffs except individual patients who bought the drug, rejecting Lilly arguments that the pension funds, unions and insurance companies had claims too different to be tried together. These Plaintiffs, all third-party payors, bought the drug for members or customers.

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