US judge dismisses Seroquel suit alleging fraudulent marketing

A US federal judge in Florida has dismissed a putative class action brought by several union health and welfare benefit funds that claimed they were duped into paying hundreds of millions of dollars for AstraZeneca's antipsychotic Seroquel (quetiapine fumarate) as a result of an alleged fraudulent off-label campaign which violated "the Racketeer Influenced and Corrupt Organizations (RICO) statute and state consumer protection laws as well as common law claims for fraud, misrepresentation, civil conspiracy and unjust enrichment".

Increasingly, third-party payers have moved to bring RICO class actions by saying that pharmaceutical manufacturers misrepresented the benefits of their drugs in off-label promotion, increasing costs. They seek redress for economic injuries. Any use of RICO is significant because the defendant may be held liable for treble damages.

In their suit, the third-party payers claimed that – because of the alleged fraudulent promotional campaign – the millions of dollars spent on the product went to treat conditions for which the drug was not approved and where less expensive, and equally safe and effective, alternative treatments existed. Specifically, they alleged that AstraZeneca, with the help of the Parexel marketing firm, "misrepresented the comparative efficacy and superiority of Seroquel over other traditional/typical or atypical antipsychotics", and "illegally marketed and promoted Seroquel for unapproved or off-label uses".

However, Judge Anne Conway of the US District Court for the Middle District of Florida dismissed the two RICO claims in a November 4th ruling.

In reaching her decision, she stated that many factors contribute to whether a physician would rely on any misrepresentation by a manufacturer. She wrote: "Thus, in the context of this case, establishing that plaintiffs' injuries were caused by defendants' misconduct would require an inquiry into the specifics of each doctor-patient relationship implicated by the lawsuit. In other words, each physician who prescribed Seroquel to an individual consumer or health and welfare fund member would have to be questioned as to whether his or her independent medical judgement was influenced by defendants' misrepresentations, and to what extent."

She went on to note: "Furthermore, as defendant AstraZeneca points out in this motion, this individualised inquiry would likely have to be conducted with regard to each consumer purchase transaction or third-party reimbursement payment made over the last approximately 10 years."

Byron Powell wrote on the FDA law blog, sponsored by the Hyman, Phelps & McNamara law firm, that the Seroquel case continues a trend by the courts to dismiss off-label cases filed by private (non-government) plaintiffs.

Some RICO claims have been allowed to move forward. In September, Judge Jack Weinstein of the US District Court for the Eastern District of New York granted class-action status to a suit filed by third-party payers alleging that Lilly violated the RICO statute with a fraudulent marketing scheme whereby it withheld information on Zyprexa (olanzapine) adverse events and disseminated misinformation about its safety and efficacy, and marketed it for off-label uses. He indicated that physicians may have relied on Lilly's alleged misrepresentations, and thus payers are entitled to a jury trial of claims (Scrip Online, September 10th, 2008). Lilly has appealed against the judge's certification of a class action.