Accused of failing to warn the public about the risks associated with talcum powder in its products, Johnson & Johnson was recently named in a federal securities class action lawsuit on behalf of investors who purchased or acquired J&J securities between February 22, 2013 and February 7, 2018. Linked to an increased risk of developing ovarian cancer, the talcum powder in J&J products often contained asbestos fibers that J&J was aware of for decades without informing customers or investors.
On February 8, Frank Hall filed the complaint in the U.S. District Court for the District of New Jersey seeking to pursue damages on behalf of other J&J investors for J&J’s alleged violations of federal securities laws, including the Securities Exchange Act of 1934. In addition to J&J, the lawsuit also names Chairman and CEO Alex Gorsky, as well Chief Financial Officer Dominic Caruso as co-defendants.
“J&J has known for decades that its talc products, such as its Baby Powder, include asbestos fibers and that the exposure to those fibers can cause ovarian cancer and mesothelioma,” the class action complaint stated. “Accordingly, Defendants misrepresented and failed to disclose the danger that J&J’s talc products posed to consumers, J&J’s significant contingent liability related to its talc products, and that J&J’s revenues from sales of these products were unsustainable due to the dangerous and harmful nature of its talc products.
“In the 1990s, J&J outlined a plan to hike flagging sales of its powder ‘by targeting’ black and Hispanic women, according to a company memorandum made public in recent lawsuits against J&J.”
The complaint also pointed out that Bloomberg News published an article on September 21, 2017, exposing unsealed documents that revealed J&J knew about the risk of asbestos in its talc powder products for decades. According to those documents, J&J officials even suppressed a 1974 report revealing the discovery of trace amounts of asbestos in the talc the company bought from an Italian mine.
Shortly after the publication of that article, shares of J&J fell $2.28 per share over five consecutive sharing days. On February 5, J&J shares fell another $7.29 after CNBC reported that J&J’s stock had fallen more than 5% due to numerous lawsuits claiming its talc products such as Johnson’s Baby Powder caused cancer.
Currently named as a defendant in more than 5,500 talcum powder lawsuits, Johnson & Johnson is allegedly responsible for developing ovarian cancer in thousands of women who used J&J’s products. Appearing in court last month, Johnson & Johnson is also allegedly responsible for causing mesothelioma in a man who spent years exposed to asbestos in J&J’s talc powder products.
More than 100 people have recently filed a product liability lawsuit accusing Bayer, the manufacturer of the female birth control device known as Essure, of selling a dangerous and defective device while failing to report severe medical complications to the U.S. Food and Drug Administration (FDA). Representing women from more than two dozen states who suffered health problems from Essure, the plaintiffs filed the joint complaint earlier this month at the U.S. District Court for the Eastern District of Pennsylvania.
Approved by the FDA on November 4, 2002, Essure was manufactured and marketed by Conceptus before Bayer acquired Conceptus in June 2013. Inserted into the fallopian tubes via catheterization, the Essure implant is intended to be a permanent birth control device that prevents conception by building a layer of scar tissue around the implant.
“In short, the device is intended to cause bilateral occlusion (blockage) of the fallopian tube by the insertion of micro-inserts into the fallopian tubes which then anchor and elicit tissue growth, theoretically causing the blockage,” the lawsuit states. “However, in reality, the device migrates from the tubes, perforates organs, breaks into pieces and/or corrodes, wreaking havoc on the female body.”
According to the complaint, Bayer has previously been cited by the FDA and Department of Health for actively concealing at least eight organ perforations caused by Essure, failing to disclose at least 122 perforations, and failing to disclose 16,047 complaints to the FDA. On May 30, 2013, the FDA uncovered an internal Excel spreadsheet containing 16,047 complaints in which the Essure device migrated outside of the fallopian tube, but were not reported to the FDA.
“Lastly, Defendant concealed and altered the medical records of its own clinical trial participants to reflect favorable data,” the complaint continues. “Specifically, Defendant altered medical records to reflect less pain than what was being reported during the clinical studies for Essure and changed the birth dates of others to obtain certain age requirements that were needed to go through the PMA (Pre-market Approval) process. Subsequently, Defendant failed to disclose this and concealed it from Plaintiffs and their implanting physicians.”
On January 23, a new study published in the journal JAMA found that hysteroscopic sterilization, which includes the use of Essure, was significantly associated with a higher risk of gynecological complications than laparoscopic sterilization, which involves a surgical incision before clipping the fallopian tubes. Although hysteroscopic sterilization is less invasive, it has a higher rate of failure and often requires a subsequent second sterilization.
Besides migrating to other parts of the body and causing organ perforation, Essure devices can also lead to other adverse effects, including excessive bleeding, pain, ectopic pregnancy, and an allergic reaction to nickel in the coiled implant. Complications with Essure devices have resulted in hysterectomies, salpingectomies, and death.
In 2016, the FDA decided not to recall Essure in the U.S., but required black box warning labels to be placed on boxes containing Essure implants. On September 18, 2017, Bayer issued a press release stating that the company was discontinuing sales of Essure in every country across the world, except in the U.S.
Approximately 750,000 women around the world have been implanted with an Essure device. According to Bayer, roughly 70% of those women received their implants in the U.S.
A recently published study indicates that Actemra (tocilizumab) may increase the risk of blood loss after total knee arthroplasty in rheumatoid arthritis patients due to decreased fibrinogen levels. Actemra carries many of the same health risks as Humira and Remicade. However, Actemra has successfully omitted many of these side effects. These include heart attacks, strokes, heart failure, interstitial lung disease, and pancreatitis.
Researchers indicate that Roche agreed to sponsor multiyear studies to monitor for these health risks, including cardiovascular events. Then, the company leveraged these studies for FDA scientific advisers agreeing to omit many adverse side effects from Actemra’s label. According to a STAT investigation, the FDA has received reports on at least 1,128 people who have died after taking Actemra. Consequently, the agency has reviewed the drug’s safety several times since its approval, but still refuses to take action.
In 2016, more than 760,000 patients took Actemra, generating $1.7 billion in sales for Roche. Actemra primarily treats rheumatoid arthritis, a long-term autoimmune disorder that affects more than 24.5 million people. Besides causing pain, swelling, and stiffness in joints, rheumatoid arthritis may also result in a low red blood cell count, as well as heart and lung inflammation.
Actemra Study Results
According to recent study in Modern Rheumatology, researchers observed 115 rheumatoid arthritis patients who underwent total knee arthroplasty and were preoperatively tested for fibrinogen levels. A fibrinogen is a glycoprotein that circulates in the blood and helps stop excessive bleeding.
The researchers found that patients treated with Actemra had significantly lower preoperative fibrinogen levels than other patients. Actemra patients suffered a mean volume of blood loss of 797.1 ml. Meanwhile, other patients only lost 511.4 ml. of blood during the surgery.
“Because IL-6 has been associated with activation of the coagulation cascade and upregulation of fibrinogen transcription, we retrospectively tested the hypothesis that patients with rheumatoid arthritis (RA) treated with tocilizumab (TCZ) may lose more blood when undergoing total knee arthroplasty (TKA),” researchers concluded.
“We’ve done a very good job of making it easier to approve drugs, often based on very preliminary evidence,” Dr. Vinay Prasad, aOregon Health and Science University oncologist and medical ethicist, told STAT News.
“But we haven’t ramped up the standards of post-marketing surveillance to make sure that what’s been out there for several years is safe and effective. “The system is broken, and all the financial incentives are lined up to keep it broken,” he continued.
Competing drugs like Humira and Remicade provide warning labels to warn of significant risks. These include heart attack, heart failure, interstitial lung disease, and pancreatitis. But, Actemra’s label does not in the interest of increased prescriptions and profits. Due to Roche’s greed and negligence, patients on Actemra suffer have suffered from higher rates of these lethal side effects. Consequently, an increasing amount of individuals are filing lawsuits to take Roche to task for their actions.
The first New Jersey trial against Johnson & Johnson over asbestos exposure is now under way. The plaintiffs allege that the massive conglomerate knew that its Baby Powder contains unacceptable amounts of asbestos, causing mesothelioma, and endangering countless individuals.
Stephen Lanzo III and his wife Kendra filed the complaint in Middlesex County Superior Court. The court has not released opening statements yet. However, there are strong indications that J&J may be on the hook. An executive’s internal memo shows that there was definitive amount of asbestos in J&J’s flagship product. The executive concluded that the exposure was less than acceptable amount allotted for an asbestos minor. Yet, J&J makes this product for babies…Not asbestos minors. However, the company continues to assert that its Baby Powder has never contained the cancerous substance.
Due to the thousands of similar memos that suggest J&J knew its Baby Powder and Shower-to-Shower products were dangerous, as well as the successful litigation against the company for these products causing ovarian cancer, an increasing number of individuals are coming forward to take J&J to task for causing devastating diseases.
Current Baby Powder Trial
About a year and a half ago, Stephen Lanzo III, 46, developed mesothelioma. According to the complaint, Lanzo was “frequently exposed to asbestos-containing talc powder products” that were sold by J&J. Furthermore, he alleges that J&J’s Baby Powder “generated dust and exposed him to respirable asbestos fibers.” However, J&J has continually refused to change their Baby Powder to a safer formula or remove it from shelves in order to protect its brand identity at the cost of innocent lives.
Furthermore, the complaint also asserts that J&J and its talcum powder provider, Cyprus Amax Minerals Co., “wantonly and intentionally conspired, and acted in concert, to withhold information from Stephen Lanzo, and the general public concerning the known hazards associated with the use of and exposure to talc, including asbestos-containing talc,”
Currently, Colgate Palmolive has settled almost 50 similar lawsuits related to its Cashmere Bouquet talcum powder. J&J has lost almost every trial it has faced over ovarian cancer from its talcum powder products with massive punitive damages for its egregious corporate greed. As a result, everyone will be watching this trial very closely to see how this litigation may expand.
A new lawsuit alleges that Johnson & Johnson (J&J) and its Janssen Pharmaceutical unit actively hid Invokana amputation risks to maximize sales and profits at the expense of patients’ lives and limbs.
Michael R. Wilkinson filed the complaint this past week in the Superior Court of New Jersey. He indicates that J&J’s insidious concealment of significant Invokana amputation risks for financial gain resulted in the loss of one of his legs below the knee.
In addition to the Invokana amputation risks, Wilkinson also alleges that the drug makers also withheld information about the substantial risk of heart attacks, strokes, kidney failure, and diabetic ketoacidosis, profiting off the egregious deprivation of countless patients’ rights to make informed decisions regarding their healthcare.
“Defendants knew or willfully and wantonly disregarded the fact that Invokana causes debilitating and potentially lethal side effects… but continued to design, manufacture, market, distribute, sell, and/or promote the drug to maximize sales and profits at the expense of the health and safety of the public… in a conscious, reckless, or negligent disregard of the foreseeable harm caused by Invokana,” the lawsuit states.
According to Wilkinson, he used the popular diabetes drug from April 2015 through May 2017. But, in December 2015, Invokana amputation risks claimed his right leg below the knee. However, because the manufacturers lied about the drug’s safety, Wilkinson was unaware of Invokana’s role in causing his permanently debilitating injuries until Invokana amputation rates recently came to light. New clinical trial findings revealed an extraordinarily high rate of diabetic amputations for Invokana users. Researchers found that the risk of leg and foot amputation was twice as high among those taking the diabetes drug compared to those taking a placebo. For a population already at significant risk for amputations, this revelation was especially troubling.
Invokana Amputation Risks Just One of Its Many Dangerous Side Effects
The FDA approved Invokana (canagliflozin) in March 2013. It was the first member of a new class of diabetes drugs, known as sodium-glucose cotransporter 2 (SGLT2) inhibitors. They work by altering normal kidney functions to eliminate excess blood sugar through urination. Other members of the class include Invokamet, Jardiance, Farxiga, Xigduo, and other. However, Invokana has remained the biggest seller in the class due to its aggressive marketing.
As an increasing number of diabetics have switched to Invokana, serious health concerns continue to emerge from post-marketing adverse event reports. Consequently, the FDA has required several warning label updates over the past few years.
In September 2015, the FDA made labeling changes to include warnings about bone density changes and strengthened the warning for increased bone fracture risks for Invokana and Invokamet users. The labeling change further indicates that bone fractures can occur as early as 12 weeks after starting the medications.
That December, the regulatory agency mandated a diabetic ketoacidosis warning for Invokana. The warning indicates that the medication increases the risk for the life-threatening condition. Ketoacidosis typically requires emergency treatment. But, prior to the warning update, Invokana warnings didn’t alert patients about the importance of seeking immediate medical attention if they experienced any symptoms. These include abdominal pain, fatigue, nausea, respiratory problems, and vomiting.
In June 2016, the FDA strengthened label warnings due to high reports of kidney injuries. These strengthened warnings involved Invokana’s kidney risks. The label change warns that the diabetes drug may increase the risk of acute kidney injury and other severe health problems.
Most recently, in May, the FDA issued a mandate for a black box warning regarding Invokana amputation risks. The black box warning is the most serious labeling change within the agency’s power to require.
Invokana Amputation Risks Add New Dimension to Litigation
Since the FDA issued the Invokana amputation risks black box warning, a surge of amputees have joined the fight to hold J&J and Janssen accountable for their “conscious and deliberate disregard for the rights, health and safety of…Invokana users.”
Wilkinson filed his claim in state court. However, more than 1,000 individuals have filed similar Invokana lawsuits in the federal litigation. In December 2016, the Judicial Panel on Multidistrict Litigation (JPML) centralized all federal Invokana lawsuits for coordinated pretrial proceedings. As a result, District Judge Brian R. Martinotti is overseeing the entire federal litigation in the District of New Jersey. The JPML centralized the litigation to avoid duplicate discovery and conflicting pretrial rulings that could further impede the litigation’s resolution.
The first Invokana bellwether trial is scheduled for September 2018. The bellwether will help gauge how future juries may respond to allegations that manufacturers hid the drug’s substantial risks. While the bellwether will have no bearing on other lawsuits in the litigation, it may help influence settlement agreements.
Missouri’s high court ruled on an Essure case dispute over jurisdiction on Tuesday, favoring healthcare behemoth Bayer over 92 plaintiffs who claim that the company’s permanent birth control device caused serious injuries.
The high bench decided unanimously that a lower court couldn’t claim jurisdiction due to nonresident plaintiffs. Eighty-five of the 92 Essure case plaintiffs are from out of state. However, plaintiffs argue that Bayer’s extensive clinical trials and marketing in Missouri gives the state jurisdiction over the case.
The high bench’s ruling sets aside a lower court’s decision to deny Bayer’s motion to dismiss the Essure case involving the company’s female sterilization product causing debilitating injuries that required risky surgical procedures, including hysterectomies, to address.
The Supreme Court sent the case back to the lower court. It has ordered the St. Louis circuit court to rule on whether the plaintiffs’ amended jurisdiction claim has merit.
Recent Rulings Restrict Personal Jurisdiction for Essure Case
While the plaintiffs have a significantly strong case, they still face an uphill battle to keep nonresident claims in Missouri. Recent personal jurisdiction rulings give Bayer a substantial edge in the Essure case.
In June, the U.S. Supreme Court handed down a game changing 8-1 ruling that severely limited the reach of state courts to assert personal jurisdiction over corporate defendants. Building on its holding in Daimler AG v. Bauman, the Supreme Court affirmed that plaintiffs cannot sue large corporations in any state where the company has contacts if those contacts have nothing to do with the plaintiff’s underlying claim.
By making this point twice in three years, the Supreme Court effectively shut the door on one of the few advantages plaintiffs had over these powerful corporations with inexhaustible resources. Plaintiffs, defendants, or injuries now need to have an “adequate” connection to the state to establish jurisdiction.
Jurisdiction Ruling Fallout Eliminates Protections Essure Case Relied On
The ruling decimated many state-level provisions that helped level the playing field between injured individuals and massive corporations. These provisions allowed nonresidents to attach claims to residents’ if they suffered similar injuries from products with a nationwide presence. Justice Sonia Sotomayor was the one holdout against the ruling. She admonished the nation’s high court for handing “one more tool to corporate defendants determined to prevent the aggregation of individual claims and forces injured plaintiffs to bear the burden of bringing suit in what will often be far flung jurisdictions.”
The ruling also prevents plaintiffs from pooling resources against corporations that already have resources for these legal battles in spades. Instead, individuals will have to go into battle in much smaller numbers. They will mostly have to file where they live or venture into enemy territory. Consequently, this precedent could make it harder for plaintiffs to sue corporations in any state.
“The effects of today’s opinion will be to curtail – and in some cases eliminate – plaintiffs’ ability to hold corporations fully accountable for their nationwide conduct,” Sotomayor wrote in her dissenting opinion.
Now, corporations are taking full advantage of the protections that the jurisdiction ruling has stripped. The ruling had an immediate fallout on significant Missouri mass torts. A Missouri talcum powder mistrial was declared within hours of the ruling’s publication, and almost 100 Essure birth control lawsuits were tossed from the state within a month. In October, a Missouri appeals court threw out a $72 million talcum powder verdict against Johnson & Johnson (J&J). A jury had previously determined that the company’s talcum powder caused ovarian cancer. However, the court ruled that the new jurisdiction rules cancelled out J&J hiding significant cancer risks to protect its brand identity at the expense of women’s lives.
Personal Jurisdiction Ruling Fallout Hits Essure Case
During the November arguments in the Essure case, the Missouri Supreme Court acknowledged the rapidly changing legal climate. Chief Justice Zel Fischer referenced recent jurisdiction decisions while addressing Bayer’s counsel.
“There are certain doors regarding personal jurisdiction that are being shut, that weren’t shut when these cases were filed,” said Fischer. “And you’re winning those arguments.”
For all intents and purposes, 22nd Circuit Court Judge Joan L. Moriarity’s attorney argued for the plaintiffs while defending her ruling in their favor. He told the state’s high court judges that he would be filing an amended brief. Consequently, the court granted him the chance to gather evidence to reformulate the Essure case for jurisdiction in Missouri.
Essure Case Background
Prior to the recent changes in legal landscape, Bayer had little luck staving off most of the pending Essure cases. Faced with overwhelming evidence that the company hid serious Essure complications from the public and regulators for decades as thousands of women suffered devastating injuries, courts have not been sympathetic to Bayer’s claims that the birth control device is immune to product liability litigation due to its FDA approval for distribution.
As of December 31, 2016, the FDA had received 14,919 Essure injury reports. These reports detail complications such as severe pain, heavy bleeding, organ perforation, depression, weight gain, nickel sensitivity, infection, allergic reaction, ectopic pregnancy, and even death. In addition to these problems, it is next to impossible to remove the device alone. Consequently, many young women are forced to undergo hysterectomies to remove the Essure coils and resolve these injuries.
In its 2016 annual report, Bayer indicated it was facing 3,700 Essure device lawsuits. By October 2017, that number had skyrocketed to 10,600 cases pending in the U.S. against the pharmaceutical conglomerate. Bayer also racked up nearly half a billion dollars in impairment losses from the litigation in 2016 alone. As awareness of Essure’s severe and debilitating risks swept the globe, the company yanked the permanent birth control device from the global market except for the U.S. Bayer continues to maintain that its Essure device is a safe and effective method of birth control.
However, Congress members are now claiming that Essure is “a prime example of systemic medical device oversight shortfalls and insufficient enforcement to ensure the safety and efficacy of medical devices.” They are now looking to the FDA to answer for its failure to properly regulate Bayer’s dangerous birth control device. The lawmakers point to regulatory failings for endangering hundreds of thousands of young women.
A joint investigation by The Washington Post and 60 Minutes revealed Sunday that the Justice Department and top DEA attorneys cowed to Big Pharma lawyers rather than going after America’s largest drug distributor in what would have been the biggest opioid distribution case in U.S. history.
After two years of meticulous investigation, David Schiller and his DEA team managed to build the most powerful case ever brought against a drug company. But, instead of bringing down McKesson for its role in the opioid crisis, the Justice Department merely slapped the company on the wrist.
Nine DEA field divisions worked tirelessly with 12 U.S. attorney’s offices from 11 states to prove that McKesson irrefutably fueled the fire of America’s raging opioid epidemic.
“They had hundreds of thousands of suspicious orders they should have reported, and they didn’t report any,” Schiller said. “There’s not a day that goes by in the pharmaceutical world, in the McKesson world, in the distribution world, where there’s not something suspicious. It happens every day.”
The DEA requires drug distributors to identify, stop, and report any orders of unusual size or frequency. However, McKesson failed to report a single one until it learned it was under investigation. McKesson distributes more than 1/3 of all pharmaceuticals in the U.S. from a 30 warehouse network across the country. DEA investigators also discovered that the company was supplying pharmacies and doctors that were blatantly supplying criminal drug rings. Consequently, pills flooded the black market. But, McKesson looked the other way to feed its insatiable greed.
“Everybody kept saying, ‘It’s just a prescription drug. It’s a pill. It’s a liquid. What’s the big deal?’” Schiller said. “And I would say, ‘They’re killing people.’ And their motive? This is all for financial gain. That’s the problem.”
Opioid Distribution Investigation Overview
McKesson Corp. is the nation’s largest drug company and the fifth-largest public corporation in America. By 2014, the team, based out of the DEA’s Denver field division, said they could prove the company hadn’t reported suspicious orders involving millions of opioid pills. The company distributed these highly addictive painkillers to drug stores without prejudice from Sacramento, Calif. to Lakeland, Fla. Some of these shipments even went to corrupt pharmacies that supplied drug rings. In fact, McKesson paid little to no attention to unusually large and frequent pharmacy orders. Instead, the company continually raised its own self-imposed thresholds on pharmaceutical orders to avoid regulatory scrutiny so that it could continue shipping increasing amounts of opioids despite numerous red flags.
However, this is nothing new for the massive corporation. Regulatory subversion is practically the company’s bread and butter. In 2008, McKesson paid a $13.25 million fine for not reporting hundreds of suspicious hydrocodone orders from Internet pharmacies. In 2005, the DEA warned the company over shipping excessive amounts of Vicodin. The fact that government lawyers are afraid to touch McKesson has only served to encourage the company’s egregious behavior.
Opioid Distribution Investigation Begins to Build its Case
McKesson caught the attention of the DEA again in 2012 when state and local authorities began investigating Platte Valley Pharmacy in Brighton, Colo. The suburb is 25 miles northeast of Denver and has a population of only 38,000. However, Pharmacist Jeffrey Clawson was selling as many as 2,000 pain pills daily. Records show that most of the drugs came from McKesson’s Aurora, Colo. warehouse. The warehouse filled 1.6 million orders between June 2008 and May 2013. McKesson only reported 16 opioid orders as being suspicious during this time, and none of them involved Platte Valley. The company only started reporting the pharmacy’s orders after the DEA began its investigation.
“We would have a pharmacy in a small town out in Colorado, 200 miles from Denver, that is getting the same number of pills or perhaps exceeding a pharmacy that is located next to a medical center in the city of Denver,” said Helen Kaupang, a DEA investigator who worked on the case. “There was no legitimate reason for that pharmacy in that little town in remote Colorado to be getting hundreds of thousands of pills over a several-year period. None. There was no justifiable reason.”
“And yet, the pills kept coming,” she added.
Clawson repeatedly bumped up against the oxycodone thresholds McKesson had set for his pharmacy. But, the company simply raised those limits and sent him more so that it could collect its cut from his nefarious activities.
“The company would raise thresholds so pharmacies could order more pills without setting off suspicious monitoring alarms inside the company,” Kaupang said. “Did they think we wouldn’t look at them again? I don’t know. But they almost acted that way.”
Opioid Distribution Investigators Call for Action
Given the government’s previous actions for McKesson’s role in the opioid crisis, the company had absolutely no incentive to not continue business as usual. The federal government hung back like a shy child, allowing McKesson to destroy countless lives to further its financial goals. But, DEA investigators continued to push the government to stand up to the one corporation that might make the biggest difference.
In December 2012, the McKesson investigation team asked DEA headquarters to issue an “immediate suspension order” against the company. The DEA reserves this enforcement tool for the most serious threats to public health and safety. But the lawyers at DEA headquarters never approved the immediate suspension order. They told Schiller that there wasn’t enough evidence.
In March 2014, investigators sought a show cause order to bring McKesson to a hearing, so the DEA could argue before an administrative law judge that it was necessary to halt drug shipments from Aurora. However, DEA attorneys declined this request as well. Even though his team submitted eight boxes of documents, attorneys told Schiller that it still wasn’t enough.
As the administrative case against McKesson slowly died, the criminal case against Clawson continued moving forward. A Colorado grand jury indicted him in 2013 on drug trafficking charges along with 14 others. The indictment indicated that McKesson was Platte Valley Pharmacy’s main supplier. It also noted that the company had an obligation to report the pharmacy’s suspicious narcotic orders to the DEA.
“From 2008-2011, the percentage increase for oxycodone 30mg orders supplied by McKesson to Platte Valley Pharmacy was approximately 1,469%,” the grand jury wrote.
The jury ultimately convicted Clawson on drug trafficking charges. He is now serving a 15-year sentence. However, McKesson was never charged in the indictment despite the company’s clear role in Clawson’s operation.
Schiller Widens Opioid Distribution Investigation
As Schiller’s team was investigating the Aurora warehouse, he began broadening the investigation beyond Colorado. Schiller wanted to determine if McKesson was completely ignoring its 2008 agreement with the Justice Department to tighten its procedures. The Denver DEA division took lead as eight other divisions began to collect information on McKesson’s activity nationwide.
The DEA would go on to pursue administrative cases against 12 McKesson distribution centers. The team outlined its investigative findings in a memo:
“Supplied controlled substances in support of criminal diversion activities.”
“Ignored blatant diversion.”
“Pattern of raising thresholds arbitrarily.”
“Failed to review orders for suspicious activity.”
“Ignored own procedures to prevent diversion.”
According to government internal documents, investigators also found that McKesson warehouses in Aurora, Livonia, Mich., and Washington Court House, Oh., were supplying pharmacies that sold to criminal drug rings.
As investigators continued building administrative cases, they were also compiling evidence in anticipation of a criminal case against McKesson for knowingly supplying these corrupt pharmacies.
In the summer of 2015, “on two occasions, I was briefed by my staff, and talked to the Denver field division, and they believed they had more than enough to go after the corporation criminally,” said Joseph Rannazzisi. Rannazzisi led the DEA’s diversion office during part of the McKesson case. He now works as an attorney consultant for drug company lawsuits.
Schiller said that his team presented “more than enough evidence” to the then U.S. attorney in Denver, John F. Walsh.
“I said, ‘We have everything we could possibly want on a silver platter,’ ” Schiller said. “We had corrupt pharmacies that were being supplied by McKesson, and they were turning a blind eye to everything that was going on.”
However, Walsh determined that the team still had not produced enough evidence to bring criminal charges.
Opioid Distribution Settlement
Investigators wanted to come down hard on McKesson to send a message to rest of the industry. The team wanted to revoke a number of McKesson’s drug warehouse registrations to distribute. They also wanted to fine the drug company more than $1 billion. However, more than anything else, they aimed to bring the first-ever criminal case against a drug distribution company to prevent McKesson and other distributors from continuing to create addicts to boost profits.
While Schiller and his team envisioned marching an executive in handcuffs out of McKesson’s immense San Francisco headquarters, the Justice Department had drastically different ideas. Instead of levying charges against the company for its dangerous disregard for the health and safety of the American public, the Justice Department struck an exceptionally lenient deal with the corporation. There were no criminal charges. No administrative cases. No $1 billion fine. Despite the magnitude of evidence the team had gathered, discussions about criminal charges never were addressed during negotiations between government lawyers and the McKesson.
“It was insulting,” Schiller said. “Morale has been broken because of it.”
None of McKesson’s warehouses lost their DEA registrations. The company ultimately agreed to temporarily suspend controlled substance shipments at four distribution centers. McKesson’s Aurora registrations would be suspended for three years, while Washington Court House and Livonia faced two year suspensions. Its Lakeland, Fla. warehouse would only be prohibited from distributing one type of narcotic, hydromorphone, for one year.
Mckesson also agreed to pay a $150 million fine. While the fine set a drug distribution record, it is only $50 million more than the company paid McKesson board chairman and chief executive John H. Hammergren in 2016. Hammergren is America’s third-highest-paid chief executive. Furthermore, McKesson’s revenue is almost $200 billion a year – almost equal to ExxonMobil.
McKesson Angles to Retain Federal Contracts for Opioid Distribution
Not satisfied with literally getting away with murder, McKesson urged the Justice Department to sweeten the deal. The company asked for a provision that would allow the Livonia and Washington Court House to continue to distribute drugs to Veteran’s Affairs, the federal prison system, and the Indian Health Service. McKesson has a $31 billion government contract to supply VA facilities and other federally-subsidized medical centers.
However, some DEA officials took a stand against McKesson’s request due to the company’s history of noncompliance with federal regulations.
“Notwithstanding, their bad acts continued and escalated to a level of egregiousness not seen before,” Imelda L. Paredes, a DEA official, wrote in a memo on March 30, 2015. “They were neither rehabilitated nor deterred by the 2008 [agreement].”
Paredes also noted that McKesson had received an exception for the VA in 2008. She argued that allowing McKesson to continue to narcotic distribution was “inconsistent with the public interest.”
“How then, can the Government say it is inconsistent with the public interest for McKesson to distribute to the general public. However, they are ‘good enough’ to serve veterans?” she questioned.
McKesson and government officials said that punishing the company would come at the expense of veterans’ well-being due to disruptions in drug flow. But DEA officials remained adamant that there would be no such disruption if the government would just give the contract to one of McKesson’s competitors.
“Find other distributors,” Paredes wrote.
However, the DEA’s legal office overruled these objections in favor of appeasing the opioid distribution conglomerate.
“I’m totally against settling, but how do we hold their feet to the fire if counsel refuses to litigate?” Paredes wrote to Schiller about the settlement. “Our attorneys have us over a barrel with their refusal to go to court.”
Opioid Distribution Settlement Aftermath
The opioid distribution settlement illustrates a significant ongoing conflict between drug investigators and government attorneys for the DEA and Justice Department. Drug investigators have taken an aggressive approach to addressing the opioid crisis that killed almost 200,000 people between 2000 and 2016. However, drug companies have managed to intimidate government lawyers from taking significant action with their own high-power attorneys.
Schiller indicated that DEA lawyers repeatedly suggested taking on smaller companies rather than trying to bring down major distributors.
“’Why would you go after a Fortune 50 company that’s going to cause all these problems with Ivy League attorneys, when we can go after other [DEA registration holders] that are much lower, that are going to put up no fight?’” Schiller said the attorneys continually asked him.
“And I said, ‘That’s exactly why you want to go after McKesson. They’re the prize,” he continued. “They’re the ones that are going to send a message to the thousands of mom-and-pops, to other big distributors, to the manufacturers, that this is no longer acceptable.’”
The tepid settlement demoralized Schiller and his team. It also left them questioning a system that continues to refuse to take a firm stand against these companies to protect the public and do its part to fight the drug epidemic that is ravaging the country.
“Within the ranks, we feel like our system was hijacked,” said Kaupang.
If Congress Keeps Settling, People Will Keep Dying
DEA investigators aren’t alone in feeling that the federal government isn’t taking the necessary steps to address the ongoing opioid crisis at the source – opioid distribution and manufacturing. Across America, 41 state attorneys general have joined forces to sue the opioid industry.
“One of the things we have to do is begin to hold the pharmaceutical companies accountable,” said Sen. Maggie Hassan. Her state, New Hampshire, has the second-highest drug overdose rate in the nation. “Right now, when you see a fine for the McKesson company for a hundred-fifty million when they make a hundred million a week in profits, that isn’t going do it.”
Hassan indicated that congress needs to fight back against the pharmaceutical giants that would sooner turn the entire country into opioid attacks than concede one bit of market share.
“The pharmaceutical industry is doing everything it can to keep this epidemic going,” she said. But, the federal government continues to comply with the opioid industry instead of enforcing its own regulations. Consequently, state attorneys general are taking up the slake to hold these companies accountable “for the cost of this terrible epidemic.”
Federal appeals judge Alex Kozinski announced his retirement effective immediately Monday due to mounting allegations of sexual misconduct.
Nine more women came forward this past week with allegations that the high-profile Ninth Circuit judge subjected them to sexual comments and other forms of improper behavior.
Kozinski is known for his libertarian views and colorful written opinions. Several women had already accused him of a subjecting them to a range of inappropriate sexual conduct and comments. Ninth Circuit Chief Judge Sidney Thomas initiated a complaint to investigate the judge’s behavior on Thursday. However, Chief Justice John Roberts Jr. transferred the complaint to the second circuit to minimize any potential conflicts of interest. Assistant Circuit Executive David Madden said in a statement on Thursday that “one or more” of Kozinski’s clerks had resigned. But, the reason is still unclear.
The new allegations bring the total number of women accusing the judge of inappropriate behavior to at least 15. They include both women who worked for Kozinski and those who merely encountered him at events. Four of the women are also claiming he touched them inappropriately. The Washington Post had speculated that the judge may be forced into retirement. Now, it appears these measures will be unnecessary.
Kozinski released a statement Monday to apologize for his behavior and announce his retirement. In his statement, the judge indicated that he ““always had a broad sense of humor and a candid way of speaking to both male and female law clerks alike. In doing so, I may not have been mindful enough of the special challenges and pressures that women face in the workplace. It grieves me to learn that I caused any of my clerks to feel uncomfortable; this was never my intent. For this I sincerely apologize.”
Kozinski said friends and family had encouraged him to remain on the bench to defend himself against the sexual harassment allegations. However, the judge said that he felt that fighting the allegations would interfere with his judiciary duties and the federal court as a whole.
“I cannot be an effective judge and simultaneously fight this battle,” he said in the statement. “Nor would such a battle be good for my beloved federal judiciary. And so I am making the decision to retire, effective immediately.”
Kozinski Sexual Misconduct with Peers
A retired U.S. Court of Federal Claims judge has come forward with allegations that Kozinski sexual assaulted her in a moving vehicle. Christine Miller, 73, said that the judge had invited her to attend a legal community function in the Baltimore area. During the drive back together, Miller claims Kozinski asked her if she wanted to stop at a motel and have sex.
Miller was married and in her early 40s at the time. She said she had considered the judge, who had served as chief of the Claims Court, “an ally and professional friend” but had no romantic feelings for him.
“I told him, no, I wasn’t interested and didn’t want to be involved in anything like that,” she said. However, Kozinski persisted.
“He said if you won’t sleep with me, I want to touch you, and then he reached over, and — this was the most antiseptic — he grabbed each of my breasts and squeezed them,” Miller said.
According to Miller, she stared straight ahead until he dropped her off at home soon afterward.
Miller immediately told a friend and her husband, both of whom are now deceased. Her current husband, Dennis Miller, said when he first started dating Miller decades ago, she also told him of a groping incident with Kozinski.
Kozinski Harassment at Events
Leah Litman, 33, is a University of California at Irvine law professor. She appeared with Kozinski on a panel at her school in July to discuss Supreme Court issues. Litman had dinner with the judge at the Italian restaurant Canaletto the night before their panel. He joked that he had just had sex with his wife and said she and others at the table would be “happy to know it still works” before pinching her side and just above her knee with his thumb and middle finger. The judge also tried to feed her with a utensil.
Another University of California at Irvine professor, Rick Hasen, was also at the dinner. He recalls Kozinski making a comment similar to Litman’s description. Hasen described the experience as “surreal.” However, he said he would not have been able to see any touching of Litman’s leg or side.
Three of Litman’s friends also confirmed that she told them about incident soon after it happened. Litman provided screenshots of text message exchanges with two of them. In one exchange, she said she was touched repeatedly, remarking, “It was gross.”
Another woman said that she was at a legal community function in downtown Los Angeles in 2008 that the judge was also attending. The lawyer claims he approached her when she was alone in a room and kissed her on the lips. The woman was in her 50s at the time and barely even an acquaintance of Kozinski.
“It was really disgusting,” the woman said. “It would have been disgusting if I were young, but it was particularly gross and unwelcome.”
The woman’s husband confirmed that his wife told him about the incident. But, they felt, given Kozinski’s position, that they were powerless to do anything.
Kozinski Misconduct Toward Students
When a 33-year-old woman was a student at the University of Montana Law School in 2016, Kozinski came to speak at an event. She encountered the judge at a reception afterward. Her lapel was partially covering up her name tag. In an apparent attempt to read it, the judge “very deliberately put his finger on the other side of my breast, and moved it, with some pressure” toward the center.
“It was shocking to me,” the woman said. “I thought it was wrong. I thought it was inappropriate, and it felt extremely entitled.”
She told four of her friends about the incident soon afterward. One friend, Kathryn Ore, 31, then a fellow Montana student, was also at the event. She said the judge “spent the whole time staring at my breasts” during a conversation.
“It was long enough and the context was weird enough that it kind of threw me,” Ore said. She concedes that it was possible his gaze meant something else. However, she added, “I don’t think I misinterpreted.”
Kozinski Sexual Mishandling of Underlings
On December 8, the Washington Post reported that six former clerks or more junior staff members called externs in the U.S. Court of Appeals for the 9th Circuit were alleging that the judge had subjected them to inappropriate sexual comments or conduct. Two of the women say he showed them pornography in his chambers. A former clerk described an incident when he showed her an open legged image of a naked man. However, it did not have the “intent” of typical porn. But, the former clerk was still startled by the incident.
“I was pretty shaken about it,” she said.
Another former clerk confirmed that she told her about what had happened soon after the incident.
Soon after this account became public, two more women published firsthand accounts of impropriety. Dahlia Lithwick clerked for another judge in the 9th Circuit in the mid-1990s. She wrote in Slate that Kozinski asked her what she was wearing after learning she was in a hotel room. Nancy Rapoport, special counsel to the president of the University of Nevada at Las Vegas, also used to clerk for another 9th Circuit judge. She wrote in a personal blog post that Kozinski invited her to drinks during her clerkship and remarked, “What do single girls in San Francisco do for sex?”
President Ronald Reagan appointed Kozinski to the appeals court in 1985. He served as chief judge for seven years – November 2007 to December 2014.
Kozinski’s retirement comes amid a surge of sexual harassment claims in the entertainment industry, bringing workplace conduct to the forefront of the country’s social consciousness.
As a jury was slamming Johnson & Johnson with a $15 million vaginal mesh verdict Thursday, a West Virginia federal judge was dismissing nearly 350 settled pelvic mesh lawsuits against Boston Scientific in the sprawling multidistrict litigation (MDL) over devastating injuries from these dangerous devices.
On Wednesday, the plaintiffs and Boston Scientific filed two joint motions for dismissal with prejudice. The motions indicate they’d reached a settlement for hundreds of cases in the massive five-year-old litigation. Other than each side handling its own costs, additional details are sparse. The extent of pelvic mesh litigation still pending against company after these settlements is also unknown.
Boston Scientific Pelvic Mesh Litigation and MDL
The Judicial Panel on Multidistrict Litigation (JPML) centralized 150 vaginal mesh cases into three MDLs in West Virginia in 2012. A recent order indicates the litigation has exploded to seven MDLs with 28,000 cases against Boston Scientific and other manufacturers.
In November 2014, a Florida federal jury ruled that Boston Scientific negligently manufactured the Pinnacle Pelvic Floor Repair Kit. The jury awarded $27 million to four women. These women experienced infection, organ perforation, nerve damage, blood loss, and chronic pelvic pain due to the defective device. However, there were no punitive damages in the bellwether trial. The Eleventh Circuit upheld the ruling in October. In a related bellwether case, a West Virginia jury hit Johnson & Johnson subsidiary Ethicon with a $3.27 verdict in August 2014.
So far, Boston Scientific has weathered the largest pelvic mesh verdicts both in and outside of the MDL. Outside of the MDL, a Delaware state court ordered Boston Scientific to pay $100 million for a woman’s debilitating injuries. The verdict consisted of $25 million in compensatory damages and $75 million in punitive damages. The excessive punitive damages were to punish the company for negligent manufacturing practices and hiding its mesh products’ dangerous defects to further its own financial interests at the peril of unsuspecting patients. However, the court later reduced this award to $10 million.
Boston Scientific Settlement Comes at End of Busy Week for Vaginal Mesh Scandal
A New Jersey jury hit Johnson & Johnson and its Ethicon subsidiary with a $15 million vaginal mesh verdict Thursday. The court ruled that the companies lied about a pelvic mesh product’s safety to continue profiting off the device. Meanwhile, the mesh implant destroyed thousands of women’s lives, sentencing them to a lifetime of debilitating pain. It was J&J’s second loss in New Jersey state court over claims that the company marketed patently unsafe devices, putting greed before patient safety.
The week got off to a running start when New Zealand also became the first country to effectively ban pelvic mesh implants. The country’s Ministry of Health announced Monday that it had told leading mesh manufacturers that they either had to prove that the controversial implants were safe or quit selling them come January. Mesh suppliers immediately responded that they would just quit selling. Their response to New Zealand sends a clear message about the actual safety of these devices.
On the heels of this announcement, BBC Panorama aired a pelvic mesh investigation Monday evening. The program revealed the substantial conflicts of interest, negligent criminal trials, and weak regulatory systems that led to hundreds of thousands of women receiving exceedingly dangerous implants that caused permanently debilitating injuries and lifetimes of agony. Not even the mesh manufacturers have any degree of confidence in these devices. It’s time that other governments follow New Zealand’s lead and ban these dangerous implants.
A New Jersey jury hit Johnson & Johnson’s Ethicon unit with a $15 million pelvic mesh verdict Thursday in the latest trial over the company’s defective implants decimating women’s lives and leaving their health in ruins.
The Bergen County jury spent most of the day in deliberation after nearly three weeks of testimony and argument. Jurors awarded a $4 million pelvic mesh verdict to plaintiff Elizabeth Hrymoc in compensatory damages. They also awarded her husband, Tadeusz, $1 million in addition to $10 million in punitive damages for Ethicon’s deplorable business practices.
Hrymoc received both the Prolift and TVT-O brand mesh devices in 2008 to treat urinary incontinence and pelvic organ prolapse. She has been in constant agony ever since, and there’s no end in sight. Despite undergoing multiple invasive and painful surgeries, doctors have not been able to fully remove the mesh. Now, she can no longer have sexual relations with her husband due to the debilitating pain.
“We love each other,” Hrymoc said of her husband. “Intimacy was a very important part of our life.”
The jury found that Ethicon consciously failed to provide adequate warnings about either of the devices’ substantial risks. However, the pelvic mesh verdict determined that the Prolift device was solely responsible for Hrymoc’s injuries.
Hyrmoc’s case is the first to go before a jury in New Jersey since 2013 when an Atlantic County jury awarded $11.1 million to a woman for another Ethicon device causing permanent injuries and pain. Despite large scale settlements of vaginal mesh lawsuits in state and federal court, Thursday’s verdict indicates Ethicon and other mesh manufacturers will continue to face jury trials. These outcomes could play a key role in future settlement agreements.
Pelvic Mesh Verdict Affirms J&J Knew Device Was Dangerous
The pelvic mesh verdict substantiates Hrymoc’s claims that J&J knew that its subsidiary’s Prolift mesh device was defective when it went on the market in March 2005. Once implanted, the polypropylene mesh tends to harden and twist, causing discomfort and pain. In more serious cases, the mesh even erodes the vaginal walls. However, Ethicon actively hid the device’s dangers to ensure its commercial success. It took thousands of devastatingly injured women filing lawsuits over the implant for J&J to finally pull the product off the market in August 2012.
During the trial, Hrymoc’s attorneys showed the implant brochure Hyrmoc had received from her doctor that explained the procedure. The brochure said there was a “small risk” of mesh material being exposed to the vaginal canal. But, numerous other reports and correspondences by Ethicon researchers indicate they felt the risk was much greater. One document said early clinical experience demonstrated an “unacceptably high mesh complication rate.”
The jury also saw documents indicating Ethicon scientists knew before even releasing the product that scar tissue would cause tension on the mesh and shrink the device. This is among the device’s most painful complications, making sexual intercourse all but impossible.
During closing arguments, Hyrmoc’s attorney told the jury that Ethicon “just didn’t care” enough about patients to thoroughly study the Prolift device before launching it. Then, the company kept important safety information from doctors and patients, because “at Johnson & Johnson marketers run everything.”
“If they cared, they wouldn’t have sold the Prolift, they would have studied it … that’s what should have happened,” he said. “They didn’t need to do this. They knew severe harm was going to happen, and they sold it anyways.”
Pelvic Mesh Verdict Sends a Message
At the conclusion of Hyrmoc’s trial, her attorney urged the jury to hit $2.7 billion Ethicon and $70 billion J&J with a punitive damages verdict that would make them sit up and take notice.
“You have a say in the language of your verdict, not only to help Elizabeth, but to punish Johnson & Johnson and to deter them, speaking a language they understand so they don’t do this again, so this trial was for something,” he said.
Moments after the jury issued the pelvic mesh verdict, Hrymoc said she became emotional because “justice prevailed.”
“I was very happy. I was very overwhelmed,” said Hrymoc. “I’m hoping it will help other women to get their compensation.
Her attorney echoed that sentiment, saying he hoped the verdict will cause J&J to settle claims from other vaginal mesh plaintiffs. Some of these women can’t even pay their medical bills.
“The women deserve peace,” he said. “They deserve to … put this behind them.”
“And frankly, the smartest thing Johnson & Johnson could do is to step up to the plate, fairly compensate these women with fair settlements and put this episode behind them, having learned the lessons — the lessons that the jury confirmed,” he continued.
Pelvic Mesh Verdict Caps Off Eventful Week
The pelvic mesh verdict comes at the end of an eventful week for vaginal mesh campaigners. On Monday, a BBC Panorama vaginal mesh investigation exposed the substantial conflicts of interest, negligent criminal trials, and weak regulatory systems behind the “biggest health scandal since thalidomide.”
Specifically, the program focused on Ethicon’s Gynecare TVT. The investigation uncovered a shocking lack of clinical testing for the device. Ethicon launched the implant after only testing it on 31 women for five weeks post-op – and some sheep. The company quietly withdrew the dangerous device from the market in 2012. However, this was after the defective device had already maimed thousands of women, causing chronic pain and permanently debilitating conditions.
New Zealand also became the first country to effectively ban pelvic mesh implants this week. The country’s Ministry of Health announced Monday that it had told leading mesh manufacturers that they either had to prove that the controversial implants were safe or quit selling them come January. Mesh suppliers immediately responded that they would just quit selling.
The mesh manufacturers are the only ones who have all the data from clinical trials and adverse event reports. Their response to New Zealand sends a clear message about the actual safety of these devices. Now, if only other countries would start to listen. If regulatory agencies continue to put corporate interests before patient health, then more governments need to step in to get these dangerous devices off the market.