Tuesday, June 9, 2009

Pennsylvania Employees Benefit Trust Fund Files federal Civil RICO ENHANCE Suit. . . .


I would imagine that Schering-Plough and Merck, the two principal defendants in the suit, will move to have this case consolidated with the amended putative class actions that make civil RICO claims, all filed last year, in the federal District Court in Newark, New Jersey, now pending before Judge Cavanaugh. The case is Pennsylvania Employees Benefit Trust Fund v. Schering-Plough, et al. (Case No 09-2558, US Dist Ct NJ, Complaint filed June 8, 2009). This same approach will likely be taken (but hasn't yet -- even almost a year later, now) in the suit brought by Suffolk County (in the Hamptons), New York -- as I explained in detail, last Summer. [Click on the small image, at lower right, to read that complaint.]

In any event, here is a copy of the full 32 page Pennsylvania complaint (PDF file), and snippet from it:

72. . . .Schering-Plough . . . conducted and participated in the affairs of MSP, and all Defendants have conducted the affairs of the Association In Fact Enterprise, through a pattern of racketeering activity that includes predicate acts indictable under 18 U.S.C. 1341 (mail fraud) and 1343 (wire fraud), through the following actions, among others, as is set forth in detail above:
i. At all times relevant hereto, Defendants fraudulently promoted Zetia and Vytorin in violation of 18 U.S.C. 1341 and 1343. Defendants consistently described Vytorin’s and Zetia’s ability to reduce bad cholesterol, falsely linking the drugs’ reduction of bad cholesterol with a reduction (or slowing of the growth) of arterial plaque, which Defendants consistently asserted causes heart disease, heart attack, and stroke. Defendants specifically cited many authorities, including the American Heart Association, to lend misleading credibility to their claims regarding the drug’s capabilities. . . .

iii. Defendants’ website for Vytorin continues to exhibit several examples of Defendants’ misleading message that lowering bad cholesterol is equivalent to reducing the risks of heart disease, heart attach and stroke, a message that was negated by Defendants’ ENHANCE study results. Defendants’ website for Zetia is titled “A different way to fight cholesterol” (emphasis in original). It states, “ZETIA works differently,” going on to contrast Zetia with statins. Neither the Zetia nor the Vytorin websites explained that the “different” or distinct ways there drugs work produce no cardiovascular benefits for the patients taking them. Defendants uniformly omitted all mentions of the ENHANCE study, which would have negated Defendants’ claims about the purported benefits of Zetia and Vytorin. Such fraudulent misrepresentations of Zetia and Vytorin’s capabilities violate 18 U.S.C. 1343. . . .

v. The full results of the ENHANCE study were, after two years’ delay (and a continuous record of concealment by Defendants) finally presented at the American College of Cardiology conference on March 30, 2008. Having demonstrated “zero” benefit for the patients who took it, the American College of Cardiology and American Heart Association released statements recommending that Vytorin be a medicine of the last resort, to be used only when other medications cannot be tolerated. Statements from the American College of Cardiology, the American Heart Association, and prominent cardiologists across the country establish the medical consensus regarding Vytorin’s ineffectiveness. Notwithstanding this medical consensus, Defendants have continued to market Zetia and Vytorin. Neither the Vytorin nor the Zetia website initially contained any reference to the results of the ENHANCE study, even after its results were released. A link entitled “Information about the ENHANCE Trial” was eventually added, but later removed. That link connected to a series of press releases from Defendants and provided no statement about ENHANCE or any direct link to the study itself or independent parties’ statements on the study. The Vytorin and Zetia websites now contain no information on the ENHANCE trial, and earlier contained links to no statement later than January 17, 2008, with no link to the American Cardiology Conference’s April 1, 2008 statements on Vytorin, stating that the ENHANCE trial "reinforces the need to adhere to current American College of Cardiology/American Heart Association Guidelines, which recommend statins to the maximally tolerated dose or to goal as first line treatment for patients with coronary artery disease."

vi. In a two-page advertisement taken out in the January 20, 2008 New York Times and re-run in January 23, 2008, Merck and Schering-Plough, mentioned, but did not reveal the ENHANCE study’s results. They continued to imply that the purported benefits of Zetia and Vytorin were equivalent to cholesterol medications that slow the growth of fatty plaque in the arteries. The advertisement stated, “In fact, Zetia and Vytorin have been proven to lower LDL (bad) cholesterol along with diet [sic], in multiple clinical studies involving thousands of patients. Both the American College of Cardiology and the American Heart Association agree that lowering bad cholesterol is important. Elsewhere, the advertisement stated, "LDL is called ‘bad cholesterol’ because it can cause build up in the wall of your arteries and form plaque." However, the advertisement did not state that the ENHANCE study had shown that Vytorin did not slow -- and may have contributed to -- the growth of fatty plaque in the arteries. . . .

On Plaintiff’s claim for Violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law, in the amount of Plaintiff’s actual expenditure for Zetia and Vytorin from October, 2002 through the present along with treble damages as set forth in 73 P.S. § 201-9.2(a). . . .

As is true in all similarly-situated civil RICO "pattern activity" private suits, if the plaintiff prevails, the liability for all plaintiffs' attorneys fees may be shifted to Schering-Plough, by the court -- as punishment -- under that statute. I think Bloomberg was the first to report this filing, by the way.

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