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April 18, 2015

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Drug firms told to pay $162 million in hepatitis C case


John Gurzinski/

Anne Arnold is hugged by her attorney Robert Eglet after a jury on Monday, Oct. 10, 2011, ordered three pharmaceutical companies to pay $162.5 million in punitive damages to plaintiffs in a lawsuit that accused them of negligently distributing large vials of an anesthetic to Las Vegas clinics at the center of a 2008 hepatitis C outbreak.

Updated Monday, Oct. 10, 2011 | 4:53 p.m.

Drug firms told to pay $162 million in hepatitis C case

A jury on Monday ordered pharmaceutical companies to pay $162.5 million in punitive damages in a lawsuit that accused them of negligently distributing large vials of an anesthetic to Las Vegas clinics at the center of a 2008 hepatitis C outbreak.

Click to enlarge photo

Plaintiff Anne Arnold (right) reacts along with attorney's Robert Adams (left) and Robert Eglet (center) hugging Anthony Devito after a jury Monday, Oct. 10, 2011, ordered three pharmaceutical companies to pay $162.5 million in punitive damages to five plaintiffs in a lawsuit that accused them of negligently distributing large vials of an anesthetic to Las Vegas clinics at the center of a 2008 hepatitis C outbreak.

Sun Coverage

A jury on Monday ordered three pharmaceutical companies to pay $162.5 million in punitive damages in a lawsuit that accused them of negligently distributing large vials of an anesthetic to Las Vegas clinics at the center of a 2008 hepatitis C outbreak.

The damages awarded in Clark County District Court are on top of the $20.1 million in compensatory damages awarded to five plaintiffs Thursday after a jury found Teva Parenteral Medicines Inc., Baxter Healthcare Corp. and McKesson Corp. liable.

Plaintiffs' lawyers had accused the companies of putting corporate profits ahead of patient safety, and of recklessly distributing 50 milliliter vials of the powerful anesthetic propofol to clinics where 10 or 20 milliliter doses were commonly needed for outpatient colonoscopy procedures. They had sought $600 million in punitive damages.

Teva attorney Mark Tully declined comment to reporters after the verdict was read, while photographers and news cameras snapped pictures of family members of the plaintiffs hugging each other and their lawyers.

"I'm glad this if over with. It's not about the money," said Anne Arnold, who was awarded $10 million in compensatory damages, plus a share of the punitive award.

"I don't want anybody else to go through what I'm going through," she said. "It's hell."

Philip Hymanson, attorney for Baxter and McKesson, told jurors the propofol was manufactured properly and delivered properly, and that clinic doctors and anesthesiologists were at fault if they misused it. Hymanson said there was no proof that happened.

The companies maintain the vials were properly marked with instructions and warnings, and that jurors weren't allowed to hear that reusing syringes on multiple patients and not following proper sterilizing procedures could also have spread the incurable liver disease.

Teva was ordered to pay $89.4 million, while Baxter was told to pay $55.3 million and McKesson was ordered to pay $17.9 million.

Robert Eglet, an attorney for the plaintiffs, said the cases would continue until the companies change the vials it sells. He said the judgments should also urge the companies to settle cases that have not been resolved.

"They need to come to this community and they need to make this right and resolve this case with everyone," he said. "But if not, we're prepared to continue on."

The civil trials are the first of several now reaching trial phases in Las Vegas stemming from the 2008 hepatitis outbreak traced to colonoscopy clinics run by Dr. Dipak Desai. Southern Nevada health officials advised about 50,000 patients who received endoscopy procedures at Desai clinics to be tested for hepatitis. At least nine and as many as 114 patients were infected with the disease.

Desai and his clinics reached undisclosed settlements with plaintiffs before trial and are no longer involved.

A jury heard seven weeks of testimony before finding the three companies responsible for injuries to endoscopy clinic patients Robert Sacks, Anthony Devito and Arnold, and to spouses Donna Devito and James Arnold.

Teva has promised an appeal. A statement from company spokeswoman Denise Bradley blamed plaintiffs' injuries on clinic doctors and anesthesiologists who "blatantly ignored" product handling instructions "and also used unsanitary practices."

Another Clark County District Court jury last year found Teva and Baxter liable for damages in a similar case and awarded a combined $500 million in punitive damages to a Las Vegas private school principal and his wife. The man, Henry Chanin, claimed he contracted hepatitis C during a routine endoscopy procedure in 2006.

The companies have appealed that case to the Nevada Supreme Court.

Separately, Desai and two nurses have been indicted on criminal charges including racketeering, insurance fraud and neglect of patients. They pleaded not guilty. Trial in Clark County District Court has been delayed until next year amid questions about Desai's competence to stand trial after several strokes.

Propofol is the same anesthetic at issue in the ongoing involuntary manslaughter trial in Los Angeles of Michael Jackson's former physician, Conrad Murray. Authorities say Jackson died in June 2009 of acute propofol intoxication combined with other sedatives administered by Murray in the singer's bedroom. Murray has pleaded not guilty.

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  1. This is a deep pocket deal here. They are not ever going to see that $600 Million. Millions more are going to be spent on attorneys and court for years to come.

    The Doctor and his staff is the cause of this problem. The larger containers of the drug did not cause the problem.

    They went after the ones with the big money but I am betting they will never see more then 10% of it and that is not going to be for many years.

  2. And you wonder why the cost of health care keeps going up. This isn't the only reason by any means, but it is a contributing factor that can not be ignored.

  3. I'm sorry, this is my fault. I voted for the judge who let this get out of hand.

    This affects more than healthcare. If this is the law in Nevada, it threatens to put Nevada off limits -- or dramatically increase prices to Nevada consumers -- for everything.

    If this is the law in Nevada, the only way for a manufacturer or re-seller to avoid liability in Nevada for (formerly) unimaginable criminal acts by third parties would be to refuse to sell products for use in Nevada. If their businesses can be destroyed by liability for improper use of their products by others, what manufacturer of anything will sell any product into Nevada -- what wholesaler would deliver any product knowing that it could wind up being used in Nevada?

    If we in Nevada wanted to buy anything, we would have to travel well beyond our borders (so that the seller wouldn't know that we were buying to take the item back to Nevada to use it) to get anything, a car, a computer, food, medicine -- anything. No one would sell inside or near Nevada or to anyone who might bring the item into Nevada because they would have liability for misuse by us or by someone else.

    How convenient would that be for us? How expensive?

    And do we think that this isn't reverberating around the business world? (The only silver lining around this toxic self-generated cloud is that we have the opportunity to save all that money we were going to spend over the next 30 years trying to convince people that Nevada is "business-friendly".)

  4. They are celebrating prematurely. They'll never see the money. The punitive damages awarded will be overturned and, you are right, vegaslee, the attorney's meters will continue running for years and eat up much of what will finally be awarded. Though those damaged by the low-life Desai & his go-along staff members deserve to be compensated, only court personnel & ambulance-chasers make out in cases such as these. The drug companies are not the ones at fault. Desai and his insatiable thirst for money is! It's good that Arnold said, "it is not about the money," because she'll see very little.

  5. tsk, tsk...

    Siding with Big Pharma?
    Against the 'common folk' that suffer due to their negligence?

    If you disagree with the verdict, I can certainly understand that...if what you disagree on is that THE AMOUNT OF THE DAMAGES is excessive for ANY case.

    Beyond that number, unless you sat on the jury, heard all the facts, and sat in on the deliberations, you really aren't exactly an 'expert' on whether the verdict is a proper one.

    MANY, many Las Vegas Valley residents and their families have been gravely affected by this egregiously bad practice... if the jury thought the drug companies were WRONG for selling/packaging their product in containers that promoted their misuse by the endoscopy clinic, I respect the jury's decision.

    Further, I find FINK'S assertion that "they'll never see the money" laughable. They will get paid, though the award amount is likely to be lowered it will remain substantial. His further assertion that "only court personnel & ambulance-chasers make out in cases such as these" not only shows a great disrespect to all those involved in this grand fiasco, it misses the ENTIRE POINT of WHY these cases are IMPORTANT to begin with, and WHY damages are often so high. The JURY is sending a message, and awarding big dollars is the only way to effectively slap Big Pharma so that they'll even notice it.

  6. This is a multi trillion dollar racket. There will be a settlement to avoid years of appeals and business will go on as usual. Drug companies get suid constantly and almost always lose. They know how to play the game.

  7. Teva knew when they sold 50mg vials for 10mg usages this would lead to abuse. The stuff is expansive. Teva could care less. Every hospital in the world uses the stuff.
    Picture buying 50 gallons of gas, using 10 gallons and being told to throw the rest away. People don't behave in this manner.

  8. Hageman, et al.

    It is pretty obvious why large corporations learn "how to play the game." What you and most like can't quite comprehend is that charging everyone more so a few can benefit is a big part of that same game.

    Hageman, your "understanding" is quite simplistic, and as such, a jury made up of simpletons such as yourself has just ensured that the cost of these drugs will increase for us all.

    Strange logic there Hageman.


  9. What you don't understand is that there are hundreds of lawsuits rea Propofol all over the world. Teva is losing them ALL. Improper manufacture, dosage issues,contamination issues as well as the Vegas issues. The cost of caring for those made sick will be in the tens of millions.
    There is currently a nationwide study to try to determine how many are made sick by all the rediculous drugs being prescribed.
    The first ten year studies are coming forward on statins. You know, the cholesterol crap. Preliminary indications are that they do NOTHING. Lipitor alone iis a multi billion drug that millions take.
    Teva makes so much money it is one of the biggest hedge fund holdings. American families have 5 prescription drugs prescribed per family at a cost of $440 billion a year. Drug companies like cigarette companies pay out billions in suits but take in trillions over time. A tiny cost that adds very little to overall medical spending.

  10. If Teva would have changed the dosages many years ago when anesthesiologists started complaining about the large bottles they would have avoided this. They were making to much $$$$ to worry about it.

  11. Let's take Heretic's example of getting drunk because the keg was too big, and build on it.

    Is the brewer liable if Heretic goes out and runs over someone because the brewer put its' beer into kegs as well as bottles or small cans? Is it liable if it sells its' beer in 24-packs and Heretic drank them instead of the keg? Is it liable for putting beer into 12-packs and 6-packs? How about the wholesaler and the retailer?

    This is not a matter of another runaway jury verdict. Rather, this is a matter of law. In most places, there is a limit to liability that depends on an unbroken chain of causation. This is called "proximate cause." In those jurisdictions intervening criminal causation usually breaks that chain.
    Apparently, there was no evidence at the trial that either the manufacturer or the distributor knew or had reason to suspect Dr. Desai's practices.

    If Nevada law would impose liability in cases such as our Heretic hypotheticals, then Nevada's people can kiss their lifestyles goodbye because no one will sell us anything, ever.

    Or, if they do, it will be hugely expensive.

  12. Hageman,

    You seem like a nice person, but reason and logic doesn't seem to be your strength. You would like us to believe that Teva would prefer to spend hard-earned revenue on lawyers, who are "a tiny cost that adds very little to overall medical spending" than to spend the pennies it would have taken to supply their product in smaller containers, although they are "making to (sic) much $$$$ to worry about."

    Now Hageman, honestly, is that what you want us to believe?


  13. Nice try. Teva reps knew Desai patient volumes and Propofol usage volumes. They also knew recommended usage amounts for a colonoscopy and that that was the main clinical use for the drug. If the drug were being used properly Desai The clinics would have had to have purchased much more given patient volume. Desai was one of Tevas best customers. They didn't care how he used the drug.
    Laws relating to alcohol and ethical pharmaceuticals differ. You don't need a doctor or prescription for booze. Drug companies are suppose to have high safety standards. Doctors also are suppose to maintain a high standard of ethics. Greed causes everything to collapse.

  14. I spent 20 years dealing with medical issues as a trust fiduciary in California. There are about 14000 healthcare related suits a year in the good old USA. The payout is about $5 billion total per year. Aggregate medical spending $2.5 trillion. Basically the total payout is about what we will spend between now and midnight on medical or approx 2% of medical spending.
    Drug companies could care less.
    I had a 1986 Lincoln mark 7 LSC. The ignition would short out the brakes. Many were injured and a few a couple of folks killed because of the defect on that model. Ford allowed the defect for several model years before a total revamp. they knew about it from the get go but it was cheaper to pay off the injure and killed than to fix thousands of cars.
    The same holds true with Teva. They have known about the vial complaints forever. The stuff is used in over 60 countries for people and animals. They are probably still selling the large vials around the world.

  15. It's a perfect analogy. It's a formula that businesses use all over the world. If it costs one dollar to fix a problem but they can make two dollars not fixing it in many instances throughout history they will go with the two dollars.

    These types of cases go on every single day. The only reason this one is making headlines is because it's a local event. The damage award will get reduced. These people will get medical care and a few million bucks to cover pain-and-suffering and the world will go on. In the meantime drug companies have made countless billions off of propofol since the 1970s.

  16. I'm not sure where you get the idea that I am implying that this is the end of the world. I am saying just the opposite. It's a nonevent for all but the people that were injured. This will blow over in a heartbeat.