United States: MDL Court Denies Certification Of Class In Testosterone Replacement Therapy Litigation

Last Updated: August 15 2018
Article by John Sullivan

This post comes solely from the Cozen O'Connor side of the blog.

The MDL court in the Testosterone Replacement Therapy ("TRT") litigation involves more than just individual product liability cases. It includes a class action. In particular, a single named plaintiff, Medical Mutual of Ohio ("MMO"), seeks to represent a class of third-party payers ("TPPs")—entities such as health benefit plans and HMOs—who will claim to have suffered economic damages when they reimbursed payments for medically inappropriate TRT prescriptions. The prescriptions were medically inappropriate, MMO argues, because they were the result of the class's reliance on misrepresentations about the safety and efficacy of off-label uses for TRT. MMO wants the putative class to get its money back. And more. It wants treble damages and legal fees under RICO (it also asserts state-law negligent misrepresentation claims).

Now, in a class action, sameness is important. As viewed by plaintiffs' attorneys, sameness is everything. The more sameness, the better. Differences, on the other hand, are deadly. They kill class actions. Accordingly, when a plaintiff files a motion to certify a class, like MMO did here, the briefing relentlessly focuses on sameness. And the defendants, you can be assured, focus on the differences. And then the court decides.

And in this instance, the Court saw a whole lot of differences. Med. Mut. of Ohio v. Abbvie Inc., 2018 WL 3586182 (N.D. Ill. July 26, 2018).

We'll start with experts. MMO put up an expert to say that TPPs act the same way with regard to drugs listed on their formularies, in particular that TTPs usually make formulary changes "only once they receive notice" from FDA about safety or efficacy concerns. Id. at 11. If this sounds over-simplified and likely not true, it's because it is. But MMO had an expert give this opinion because, if it were accepted, MMO could then argue that defendant misled the class by hiding data and risks before the FDA issued any notice. The problem for MMO, however, is that plaintiff's expert didn't have the data to support this opinion. He just said it:

But an opinion must be connected to the existing data by more than the ipse dixit of the expert. An expert's opinions may be inadmissible because there is simply too great an analytical gap between the data and the opinion offered. That is the case here.

Id.

The court also rejected this expert's opinion that the defendants interacted with all TTPs in the same way using "the same common promotional strategies." Id. at *12. Among other deficiencies, the record showed that the expert reached his opinion before beginning his work. He relied on materials selected and gathered by the plaintiff's attorneys and allegations in MMO's complaint, not his own investigation. Id.

Plaintiff also put up a causation and damages expert—the well-traveled Dr. Meredith Rosenthal—who performed a regression analysis to show that the defendants' alleged misrepresentations damaged all TPPs in the same way. The flaw in the analysis, however, was that it purported to measure the effect of the alleged misrepresentations on doctors and patients. In other words, it focused on direct-to-consumer and physician promotion, not promotion to and contact with the TPPs, the would-be class members asking for their money back. Id. at *8-9. This didn't work. Proximate causation requirements for RICO claims are stringent. Evidence of anything less than a direct causal connection to the plaintiff's injury fails. The court found Dr. Rosenthal's opinion to be irrelevant and simply ignored it. Id. at *10.

The court next set its sights on the "adequacy" requirement of a class action, in particular whether MMO itself could be an adequate class representative. Anything that could subject MMO to unique or unusual defenses—differences from other class members—could render MMO an inadequate class representative. The court found two big problems for MMO. First, MMO appeared to react belatedly and ineffectively to a notice that the FDA was investigating the safety of TRT with regard to heart attack, strokes and death. In particular, MMO did not institute a prior authorization requirement for the reimbursement of TRT prescription payments until four years after the notice, and made a number of admitted missteps along the way. Id. at *14. Second, and maybe related, its formulary management practices did not include an annual clinical evaluation of safety and efficacy of the drugs on its formulary. The court found, with the help of testimony from a defense expert, that these practices did not meet industry standards and could subject MMO to unusual defenses. Id. at *15. The Court held "that MMO is an inadequate class representative and on that basis denies MMO's motion for class certification." Id.

Not done there, the court also held that the plaintiff did not meet the predominance requirement of a class action, concluding instead that individual issues will predominate over common questions of law or fact. Id. In other words, there wasn't enough sameness to dominate the individuality. For instance, MMO could not "show that each TPP actually received defendants' alleged misrepresentations. Id. at *16. The court found that this was an individualized inquiry, varying by TPP:

Namely, defendants highlight evidence demonstrating that whether a TPP receives sales calls and clinical information from defendants depends on the number of beneficiaries the TPP insures; whether the TPP permits or prohibits meetings with drug manufacturers as a matter of policy; whether the TPP prefers to hear only business information, only clinical information, or both; and whether the TPP adopts formularies without modification from a [pharmacy benefit managers].

Id.

The court rejected MMO's argument that it should infer that all TTPs received the misrepresentations because "defendants spent millions on promotional efforts aimed at TPPs . . . including standardized promotional materials"—a kind of fraud-in-the-air theory. Id. at *17. Finding ample reason to doubt that the promotional materials were standardized, the court reasoned that "one would need to know what particular representations a TPP received in order to assess whether that TPP was exposed to half-truths." Id. That's "TPP-by-TPP proof," the very antithesis of class treatment. Id.

On reliance, the court held that individualized issues would also predominate over common issues, persuaded by defendants' evidence that the formulary management process was complex, not standardized:

Defendants point to evidence tending to show that TPPs' formulary and utilization management decisions are complex and individualized. Some TPPs do not meet with drug manufacturers at all and are thus unlikely to rely on information from them. Some TPPs use PBMs but customize the PBMs' standardized formularies. Other TPPs, including MMO for much of the class period, adopt their PBMs' formularies without modification but make their own utilization management decisions.

Id. at *18.

In short, the court found a lot of reasons to deny class certification. You can find even more in the court's opinion, which we recommend for your reading list. It is a template for how to defend against these type of TPP class actions.

This article is presented for informational purposes only and is not intended to constitute legal advice.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions