PHILADELPHIA (Legal Newsline) - The federal government and more than two dozen states won't help a drug-testing lab whose research has jumpstarted mass torts and is purporting to represent their interests over Zantac paid for by their health care programs.
Valisure LLC created headlines and tens of thousands of lawsuits in 2019 when it claimed its testing showed the heartburn medicine contained an ingredient that changed to a known carcinogen called NDMA. Lawyers cited its study in ensuing litigation, calling Valisure an "independent" lab.
A federal judge and the Food and Drug Administration eventually found fault with Valisure's testing, which included heating an artificial stomach to a level about 70 degrees lower than the average temperature of the planet Mercury.
And unbeknownst to most of the world, Valisure was calling itself a "whistleblower" in a False Claims Act lawsuit filed under seal in 2019. Under the FCA, whistleblowers sue in the name of the federal government, alleging the actions of a defendant caused the feds to make payments it shouldn't have. Prescription drug companies are popular targets.
Whistleblowers, or relators, win a percentage of whatever is successfully recovered. Valisure's amended complaint, filed May 20 in Philadelphia federal court, says GlaxoSmithKline duped programs like Medicare and Medicaid into providing Zantac to patients while concealing the chance NDMA could be created.
Valisure and the law firm Wisner Baum publicized the amended complaint with a press release. They claim GSK started defrauding the FDA by hiding the potential for NDMA in Zantac in the early 1980s, before the drug ever gained approval.
In 2019, Valisure brought its findings in a citizen petition to the FDA, which ordered a short-lived recall. The FDA said Valisure's methods were unreliable, saying the lab's "artificial stomach" was heated to 260 degrees and subjected to lethal levels of salt to create NDMA from Zantac.
Valisure detected no NDMA in the drug when testing it under normal human conditions, and a Florida federal judge in 2022 dismissed about 50,000 lawsuits after finding Valisure's methods didn't fit expert witness standards.
Delaware and California federal judges reached the opposite conclusions and allowed lawsuits there to proceed. None of this matters to its whistleblower case, Valisure says, as it is based on the actions of GSK.
“Zantac is a unique situation for Valisure,” said David Light, Co-Founder and President of Valisure.
“We not only had concern over the results of the scientific testing we conducted, but also had concern over the potential false claims implications of the historical testing conducted by GSK. This case vividly highlights the critical need for independent checks and balances in the pharmaceutical industry.”
In addition to filing the case on behalf of the United States of America, it also seeks to represent 27 states and the District of Columbia. Under the FCA, a whistleblower notifies these governments when filing, which allows them to decide whether to join the whistleblower's case.
All governments declined to intervene, according to a March 11 document, leaving Valisure and its lawyers, who include former U.S. Rep. Conor Lamb (now a lawyer at Kline & Specter) to pursue the case on their own. Maryland rules require dismissal of the state from the case because it didn't wish to join.
When the feds and states choose not to intervene, the whistleblower is entitled to a higher percentage of any recovery than if they received help from governments.
Light, Valisure's CEO, ran afoul of the law while at Yale University when police discovered an illegal arsenal of weapons and explosives that led to a one-year prison sentence. The lab has said it scored a drug-testing contract with the Department of Defense, though Legal Newsline's effort to track it down have been rejected. Several FOIA requests are pending.
Valisure's testing on acne medication has spawned more than a dozen class actions this year, though it heated products to 170 degrees Fahrenheit to find high levels of benzene in 18 days.
Valisure said the temperature was a reasonable estimation of what might occur in a shipping container or hot car.