West Virginia Attorney General Darrell McGraw
WASHINGTON (Legal Newsline) - A public interest law and policy center called last month's decision by the West Virginia Supreme Court of Appeals in favor of Janssen Pharmaceutica and its parent company Johnson & Johnson a victory.
The Washington Legal Foundation, which filed a friend-of-the-court brief in the case, had urged that the lower court's penalty be overturned.
"We were concerned that the decision below, if allowed to stand, would have harmed public health because it would deter pharmaceutical companies from speaking out on matters of public interest," WLF Chief Counsel Richard Samp said in a statement in response to the Court's decision.
The Court, in its opinion filed Nov. 18, found that a lower court erred in finding that communications from Janssen and Johnson & Johnson to state health care providers were false and misleading.
The Court, in its per curiam opinion, reversed the Brooke Circuit Court's order entering partial summary judgment and remanded the case for further proceedings.
The pharmaceutical companies had appealed the circuit court's judgment order, bench trial order and order on post-trial motions in a case brought by West Virginia Attorney General Darrell McGraw in 2004 under the state's Consumer Credit and Protection Act.
In March 2009, Brooke Circuit Judge Martin Gaughan imposed nearly $4.5 million in civil penalties against Johnson & Johnson and Janssen after finding that the petitioners made false and misleading communications about two drugs that Janssen manufactures to physicians in the state.
Those drugs include Risperdal, an antipsychotic medication, and Duragesic, a patch that delivers a continuous dose of a narcotic pain medicine through the skin.
In 2003, the U.S. Food and Drug Administration required makers of atypicals to warn doctors that such drugs were associated with an increased risk of diabetes. Janssen in November 2003 sent out "false and misleading" letters to doctors that downplayed the risks, Gaughan said in his February 2009 decision.
Following the judge's decision, the companies served notice that they would appeal. In March, the Court granted the companies' petition.
In September, the Court heard oral arguments from both the Attorney General's Office and the pharmaceutical companies.
The companies' lawyers argued the issue wasn't the drugs' communications -- including a warning letter and file card -- and disputed that any statements were false and misleading.
The issue, they argued, was that the companies hadn't had a chance to defend itself.
But the Attorney General's Office contended the communications were at the "very center" of the argument.
The Court, in its ruling, wrote, "In sum, the FDA's belief, as expressed in the warning letters and subsequent corrective letters, that Janssen violated the FDCA is not sufficient to establish, as a matter of law, that the Appellants' communications to healthcare providers were actually false and misleading in violation of the Consumer Protection Act."
The Court said it is "fundamental" that every defendant is entitled to defend themselves against "allegations of misconduct."
"Whether Janssen's statements and omissions in the Risperdal DHCP letter and the Duragesic file card are actually false and misleading under the FDCA, and thus constitute 'unfair or deceptive acts or practices' under the Consumer Protection Act, is a question of fact to be decided by a finder of fact," it wrote.
The justices said the Attorney General's Office must present evidence that the pharmaceutical companies' "specific statements and omissions do, in fact, violate the relevant laws."
In its brief, the legal foundation had argued that the $4.5 million in penalties were imposed in violation of the manufacturer's First Amendment rights.
It also argued that the trial judge erred in concluding that the First Amendment was irrelevant to the case once he determined that the communications contained misleading statements.
The foundation, in a statement released last Wednesday, was pleased to find the Court had agreed that the trial court erred in refusing to provide the companies with an opportunity to defend "the truthfulness of their statements."
"When a court decision ends up chilling speech, doctors and patients will be deprived of the robust discussion of matters of public interest that is vital to ensuring optimal health care," Samp said.
The Washington Legal Foundation is a public interest law and policy center with supporters in all 50 states. The foundation, according to its website, devotes a "substantial portion" of its resources to defending the rights of the business community to speak freely on matters of public interest.
From Legal Newsline: Reach Jessica Karmasek by e-mail at jessica@legalnewsline.com.