PHILADELPHIA (Legal Newsline) - The laboratory that claimed the heartburn drug Zantac can cause cancer could earn more than $20 million under a $2.2 billion settlement with drugmaker GSK ending 80,000 lawsuits in state courts around the country.
Valisure, a New Haven, Conn., lab with close ties to plaintiff lawyers, settled a qui tam “whistleblower” lawsuit along with the other cases for $70 million, according to GSK. Valisure filed the lawsuit in the name of the federal government, claiming GSK defrauded state and federal health plans by failing to disclose the cancer risk. The government declined to join the suit, meaning Valisure stands to reap a higher bounty of 25-30% under federal law. GSK denies all the claims against it.
Valisure, which says it is an independent testing lab, was represented in the qui tam lawsuit by Wisner Baum, the same lawyers leading the broader Zantac litigation. Legal ethics rules prohibit lawyers from paying expert witnesses a contingency fee based on the success of cases they testify in, although in this case Valisure will win millions by settling a separate lawsuit based on identical claims.
The payoff comes despite the fact a federal judge and the Food and Drug Administration both 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 to record dangerous levels of the carcinogen NDMA.
“When Valisure tested ranitidine with salt concentrations more closely approximating what a human could safely ingest, Valisure detected no NDMA,” U.S. District Judge Robin Rosenburg said in a December 2022 dismissing thousands of federal Zantac lawsuits for lack of scientific evidence.
Valisure’s qui tam lawsuit was unsealed earlier this year after the federal government and numerous states declined to join it, in a possible indication they lacked faith in the underlying allegations. The Federal False Claims Act allows self-described whistleblowers to proceed anyway, with higher bounties if they succeed.
Zantac litigation got a boost last June when a Delaware judge allowed plaintiff scientific evidence in to state cases, despite the contrary ruling by a federal judge. That ruling involved Emery Pharma, an Alameda, Calif., contract research lab run by Ph.D chemist Ron Najafi that used the same heating techniques as Valisure to claim Zantac could degrade into NDMA.
David 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 has failed to find any evidence of it despite repeated Freedom of Information Act requests to government agencies. Valisure has also declined to provide the contract.
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.