IN RE: AVANDIA MARKETING, SALES AND PRODUCTS LIABILITY LITIGATION UFCW Local 1776 and Participating Employers Health and Welfare Fund; J.B. Hunt Transport Services, Inc., Appellants
Argued: March 6, 2019
Appeal from the United States District Court for the Eastern
District of Pennsylvania (District Court Nos. 2-07-md-01871,
2-10-cv-02475, 2-11-cv-04013) Hon. Cynthia M. Rufe District
M. Sobol [ARGUED] Hannah W. Brennan Edward Notargiacomo
Kiersten A. Taylor Hagens Berman Sobol Shapiro James R.
Dugan, II Douglas R. Plymale, Eric L. Young McEldrew Young,
Eric H. Gibbs, Anne-Marie J. de Bartolomeo Counsel for
Lefkowitz [ARGUED] Thomas S. Burnett Kirkland & Ellis LLP
Nina M. Gussack, Anthony C. Vale, Sean P. Fahey, Kyle A.
Dolinsky, Hedya Aryani, Jeremy D. Heep, Yvonne M. McKenzie
Pepper Hamilton LLP Counsel for Appellee
Before: SMITH, Chief Judge, AMBRO and RESTREPO, Circuit
RESTREPO, CIRCUIT JUDGE.
two health benefit plans ("Plans"), appeal the
District Court's grant of summary judgment in favor of
Defendant, GlaxoSmithKline LLC ("GSK"), the
manufacturer of the prescription drug Avandia. The Plans
brought suit against GSK under various state
consumer-protection laws and the Racketeer Influenced and
Corrupt Organizations Act, 18 U.S.C. ch. 96
("RICO"), based on, among other things, GSK's
marketing of Avandia. The District Court granted summary
judgment in favor of GSK on the Plans' claims, finding,
in relevant part, that (i) the Plans' state-law
consumer-protection claims were preempted by the Federal
Food, Drug, and Cosmetic Act, 21 U.S.C. ch. 9
("FDCA"); (ii) the Plans had failed to identify a
sufficient "enterprise" for purposes of RICO; and
(iii) the Plans' arguments related to GSK's alleged
attempts to market Avandia as providing cardiovascular
"benefits" were "belated." The Plans
assert that the District Court erred in granting summary
judgment, and we agree.
the guidance recently provided by the Supreme Court in
Merck Sharp & Dohme Corp. v. Albrecht, 139 S.Ct.
1668 (2019), we hold that the Plans' state-law
consumer-protection claims are not preempted by the FDCA.
With respect to their RICO claims, the Plans should have been
given the opportunity to seek discovery prior to the District
Court's granting summary judgment on such claims.
Further, from the inception of this litigation, the
Plans' claims have centered on GSK's marketing of
Avandia as providing superior cardiovascular outcomes-in
other words, cardiovascular benefits-as compared to
other forms of treatment, and therefore, the District
Court's refusal to consider the Plans'
"benefits" arguments was in error because those
arguments were timely raised.
for the reasons that follow, we will reverse in part and
vacate in part the order of the District Court granting
summary judgment in favor of GSK, and we will remand to the
District Court for further proceedings consistent with this
1999, the Food and Drug Administration ("FDA")
approved Avandia (Rosiglitazone), a drug developed by GSK,
for the treatment of type-2 diabetes. Prior to the
development of Avandia and similar drugs, physicians
primarily treated type-2 diabetes by prescribing metformin
and/or sulfonylureas. GSK, however, marketed Avandia at a
much higher price point than metformin and sulfonylureas: a
one-month supply of Avandia cost approximately $220,
approximately $140 of which typically was covered by
patients' health benefit plans, whereas a one-month
supply of metformin or sulfonylureas cost approximately $50,
about $45 of which typically was covered by patients'
health benefit plans.
this cost differential, health benefit plans- including the
Plans-placed Avandia on their formularies as a
"covered" drug. The Plans, for example, determined
that it was advantageous to cover the cost of Avandia because
GSK allegedly marketed Avandia as being capable of both
controlling a patient's blood sugar levels and
reducing cardiovascular risk, the latter of which is
particularly pertinent to type-2 diabetes patients, 65% of
whom suffer fatal cardiovascular-related illnesses or
complications. Metformin and sulfonylureas-the drugs that
constituted the "standard of care" for type-2
diabetes prior to Avandia's development-did not decrease
cardiovascular risk, and therefore, according to the Plans,
GSK presented Avandia as a cost-effective alternative to
those drugs. As a result, health benefit plans covered a
large portion of the expenses related to patients'
prescriptions for Avandia, resulting in approximately $2.2
billion in U.S. sales in 2006 alone.
2006, however, concerns arose that Avandia may in fact
increase certain cardiac risks. In August of that
year, GSK submitted a Prior Approval Supplement to the FDA,
in which GSK sought approval to add information to
Avandia's label regarding the results of a recent
meta-analysis of various clinical trials. The meta-analysis,
"ICT-42," demonstrated that use of Avandia was
associated with a statistically significant increase in
myocardial ischemic events-events during which the heart does
not receive adequate oxygen because blood flow to it is
reduced. In May 2007, GSK submitted an update to its Prior
Approval Supplement, offering a new formulation of its
proposed warning with respect to myocardial ischemic events
that would, among other things, make the warning more
prominent and clear.
days after GSK submitted the update to its Prior Approval
Supplement, the New England Journal of Medicine
published a study authored by Dr. Steve Nissen regarding
Avandia ("Nissen Study"), in which Dr. Nissen
concluded that Avandia "was associated with a
significant increase in the risk of myocardial infarction and
with an increase in the risk of death from cardiovascular
causes that had borderline significance." J. App. 1064.
Following the release of the Nissen Study, a representative
of GSK held a telephone conversation with an official at the
FDA regarding progress on the FDA's review of the Prior
Approval Supplement. According to GSK's representative,
who wrote a memo memorializing the details of the
conversation, the FDA official advised that another official
within the FDA was "calling for withdrawal of [the]
approval" of Avandia, and thus, it was difficult for FDA
officials to agree on labeling language for Avandia. Sealed
App. 655-56. GSK's representative then proposed
implementing the labelling changes with respect to myocardial
ischemic events through the Changes Being Effected
("CBE") process, which permits a drug manufacturer
to implement a change to its label prior to approval
of such label by the FDA. The FDA official "strongly
advised against proceeding" through the CBE process,
stating that doing so "may give legitimacy to Dr.
Nissen's data" and "will make people think that
GSK must have other information." Id. at 656.
The FDA official concluded the conversation by reminding the
GSK representative that he "knew the regulations,"
which state that the drug manufacturer is ultimately
responsible for making the decision to pursue a labelling
change through the CBE process. Id.
8, 2007, the FDA sent a letter ("Letter") to GSK
regarding the Prior Approval Supplement. In the Letter, the
FDA stated that it had "reviewed the data provided [by
GSK in its Prior Approval Supplement] and f[ou]nd [that] the
information presented [was] inadequate" and that,
therefore, the Prior Approval Supplement was "not
approvable." Id. at 660. The FDA stated that it
had "concluded that the pooled data require[d] further
analysis to adequately convey the potential risk for
increased cardiac ischemia associated" with use of
Avandia. In particular, the FDA stated that it had
"identified certain subgroups of patients . . . that may
be particularly vulnerable to experiencing an ischemic
event" while using Avandia. Id. The FDA then
directed GSK to provide additional information "to
address the deficiency" in the Prior Approval
Supplement, including "[d]ata from studies included in a
meta-analysis performed by Dr. Steven Nissen published in the
New England Journal of Medicine that were not
included in [GSK's] pooled analysis," as well as
data from various other clinical trials. Id. at 661.
expressed its view that the "potential risk of increased
cardiac ischemia [was] a significant finding that may impact
a large proportion of patients with type[-]2 diabetes,"
and as a result, the FDA scheduled a joint meeting of two FDA
advisory committees ("Joint Meeting") "to
discuss the findings from th[e Prior Approval Supplement]
submission, additional data recently requested, and accruing
information from ongoing clinical trials" of Avandia.
Id. The FDA stated that the "outcome of th[e
Joint M]eeting w[ould] be particularly germane to any
labeling or other regulatory action needed for [Avandia] and
should be factored into any resubmission to address the above
in 2007, the FDA required GSK to implement various changes to
Avandia's label. Subsequent to issuing the Letter, the
FDA directed GSK to add a black-box warning to Avandia's
label with respect to the risk of congestive heart failure
that (i) advised physicians and patients that Avandia
"cause[s] or exacerbate[s] congestive heart failure in
some patients," (ii) instructed physicians to
"observe patients [taking Avandia] carefully for signs
and symptoms of heart failure," and (iii) warned
patients with certain heart conditions not to take Avandia.
J. App. 708. Following the Joint Meeting, the FDA
additionally directed GSK to add a black-box warning to
Avandia's label with respect to the risk of myocardial
ischemic events, advising physicians and patients that a
"meta-analysis of 42 clinical studies . . ., most of
which compared Avandia to placebo, showed Avandia to be
associated with an increased risk of myocardial ischemic
events such as angina or myocardial infarction" and that
"[t]hree other studies . . ., comparing Avandia to some
other approved ...