PHILADELPHIA – After three defeats, two of which were seven-figure verdicts, in four Philadelphia trials, what can Janssen Pharmaceuticals look forward to as it tries to resolve at least 1,600 more Risperdal lawsuits in the city?
Pete Kelso, a financial analyst at Bates White in Washington, D.C., says the drug-maker can expect more litigation, some of which will be driven by advertising and the plaintiffs’ positive early results.
Kelso, whose research into consolidated trials in New York City Asbestos Litigation is now at the center of a dispute between plaintiffs and defense attorneys, says the causation factor is of primary importance when cases on the scale of the Risperdal suits develop.
Three Philadelphia juries out of four have found Risperdal caused gynecomastia, the development of female breast tissue in males.
“That’s principally what drives litigation forward,” Kelso said.
“If the plaintiffs are successful at really convincing a jury that there was a cause and effect of them taking the drug and the after-effect or injury, that’s what really propels what could be a handful of cases into a mass tort.”
Kelso added two significant factors that have led to an increase in other pharmaceutical-based mass torts in the past and could lead to an increase in Risperdal filings.
Those are successful jury verdicts and the presence of television and online advertising initiated on the part of plaintiffs attorneys. Kelso referred to the component of advertising as “another slice that people really haven’t focused on yet.”
“I’m starting to see the Risperdal ads, they’re out there,” Kelso said.
“I think that’s another major component that helps the plaintiff attorneys. In the past decade, I think advertising on the Internet and TV has become a lot more prevalent than it used to be.
“Where one of these litigations back in the day might have taken a lot longer to ramp up, the multimedia of advertising today can accelerate a handful of cases to a mass tort a lot more quickly.”
As to the question of how the recent verdicts, totaling $4.75 million, against Janssen would impact the company financially moving forward, Kelso stipulated every pharmaceutical defendant is different – and that while the $2.5 million and $1.75 million judgments reached against Janssen in the cases of Austin Pledger and Nicholas Murray, respectively, were nothing to sneeze at, they certainly would not send the company into financial peril.
A third verdict reached recently this month netted $500,000. And plaintiffs attorneys are still hopeful they will be able to ask for punitive damages in the future, despite a Philadelphia judge’s recent decision barring them in Risperdal cases.
“Once you start to get the emergence of these multimillion-dollar verdicts, from a defense posture, especially if the litigation is centralized or if it’s put in a multi-district litigation (MDL) or a class can be formed, then it gets into more of a portfolio basis,” Kelso said.
Kelso said at that point, a pharmaceutical company would likely begin to ask itself if it’s worthwhile to litigate and defend the cases individually; or if they have been centralized through an MDL or class-action lawsuit, to settle the class and extinguish the litigation once and for all.
“I think that’s what most pharma companies get into, and that’s the plaintiffs law firms’ motivations with a lot of this stuff is to get filings, get a couple of verdicts and recruit a lot more claimants,” Kelso said.
“Get it into a class or a centralized litigation, and then try to go to the defendants and try to settle a whole class,” Kelso said.
Kelso added once a certain number of filings is reached, the pharmaceutical company will begin to conduct an evaluation to determine the size of a potential class of litigants.
At the end of November, there were 1,606 pending Risperdal suits in Philadelphia's Complex Litigation Center. More are sure to come, as 95 were filed in November.
“Once the initial pharma suits ramp up, the defendants usually step back and take a look at how widespread the drug was used by the population,” he said.
“Then, try to come up with some parameters of how many people could have taken the drug, and how many people out of that population are likely to file lawsuits against them.”
Such criteria would assist the company in determining the size of potential litigation, whether it will hit its bottom line or whether it’s part and parcel of the course of doing business.
On the issue of punitive damages, which Philadelphia County Court of Common Pleas Judge Arnold New ruled would not be applicable in Risperdal cases heard in Philadelphia (a decision currently on appeal to the Superior Court of Pennsylvania), Kelso conceded it was difficult to tell how such damages would factor into the financial effect on Janssen.
“Unless they’re restricted, the plaintiffs, and rightly so, will try to file the claims in jurisdictions where they can maximize their recovery,” Kelso said.
“Obviously, punitive damages are another cause of action to maximize recovery, so plaintiffs will try to keep it in a jurisdiction where punitives could be assessed, and defendants will always try to move it away from jurisdictions where punitives are considered.”
Kelso said if punitive damages are allowed, it serves as another component for the defendants to consider when they decide to try the cases individually or settle them as a class.
“The natural evolution this could take is one that takes place in a lot of these Philly pharma litigations,” Kelso said.
“It starts off slow, you get verdicts, it turns into a class and then it’s this big animal that the defendant has to settle or litigate to take care of.”
Kelso added such Philadelphia-based pharmaceutical litigations usually have a shelf life of one or two years, a “quick evolution,” but further stipulated it is still too early to tell the future direction of the Risperdal litigation at this early juncture.
“By this time next year, if it’s still there, we should know exactly how it plays out. Because these things do move rather quickly,” Kelso said.
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nickpennrecord@gmail.com