Eli Lilly and its top-selling drug Zyprexa (olanzapine) hit the news again yesterday with a major payout to people who had been affected aversely by the drug. Following closely on the heels of an article in The New York Times on a patient on Zyprexa who died after massive weight gain (see our discussion on “Eli Lilly under more fire with Zyprexa,” Jan. 4, 2007), the Times reported yesterday that Lilly will be settling some 18,000 lawsuits for a combined $500 million. In other words, that’s almost $28,000 per lawsuit. While not close to the scale of their previous payout last year ($87,500 per lawsuit), this development nevertheless represents yet another setback for Lilly’s defense of Zyprexa as a safe treatment for psychosis. It brings Lilly’s total settlements on Zyprexa’s account to a remarkable $1.2 billion.
Yesterday’s settlements mostly involved patients who claimed that they developed diabetes and other illnesses after taking Zyprexa to treat schizophrenia and bipolar disorder. We mentioned in our recent entry on Lilly that a 2002 analysis established a link between Zyprexa and heart disease, and it now appears increasingly likely that diabetes will be termed another official side effect of the drug. According to the Times, clinical trials have shown “that in many patients, Zyprexa also causes severe weight gain and increases in cholesterol and blood sugar.”
While for many who follow the industry, that’s old news, what is striking is this: Lilly hopes in the future to avoid similar lawsuits while continuing to market Zyprexa. Apparently, the reason for the reduced value of yesterday’s settlements (a drop of nearly $60,000) was a FDA label change for Zyprexa. Lilly now maintains that it has, since the label change in 2003, been consistently warning doctors of the health risks that attend taking Zyprexa. (For Lilly’s press release on the settlements, see here.)
What does this mean for Zyprexa and the people that take it? For one thing, people with diabetes resulting Zyprexa will likely lose the legal recourse that those patients exercised yesterday. Many may face realities such as that of John Eric Kauffman, the bipolar disorder sufferer and Zyprexa dependent who eventually passed away from heart disease. The responsibility has now been shrewdly shifted from the pharmaceutical to the doctors prescribing medicine for patients with mental illness.
Some would ask whether there’s any need for a drug that is neither necessarily safer (not by a long shot) nor significantly more effective than its alternatives. The FDA may have changed the label, and now the question is efficacy compared to older compounds. A Washington Post article in April came to the conclusion that better drugs – than Zyprexa and its olanzapine competitors – are the real answer. Reductive, perhaps, but we imagine that ploughing that $1.2 billion into developing a new, improved drug may ultimately be more rewarding than paying off patients made sick by the current one. While we know that biopolar disorder is incredibly serious and that many patients would do anything to stay on Zyprexa – and that many have gone on and stayed on Zyprexa to their benefit – too, many haven’t. Did it really need to drag on from 1996 to 2003 to get a new label – and are patients really being informed of the risks? Here's to figures like 16% of patients gaining over 66 pounds each coming to surface earlier...
Thank you to the NYT and Alex Berenson for this excellent ongoing coverage.
Lilly Settles With 18,000 Over Zyprexa
By ALEX BERENSON
Published: January 5, 2007
Eli Lilly agreed yesterday to pay up to $500 million to settle 18,000 lawsuits from people who claimed they had developed diabetes or other diseases after taking Zyprexa, Lilly’s drug for schizophrenia and bipolar disorder.
Including earlier settlements over Zyprexa, Lilly has now agreed to pay at least $1.2 billion to 28,500 people who said they were injured by the drug. At least 1,200 suits are still pending, the company said. About 20 million people worldwide have taken Zyprexa since its introduction in 1996.
The settlement covers cases filed in state and federal courts by law firms or groups of firms for 18,000 clients, Lilly said. The federal suits have been overseen in Brooklyn by Judge Jack B. Weinstein of the Eastern District of New York.
The settlement will not affect continuing civil or criminal investigations of Zyprexa by state attorneys general and federal prosecutors.
Both Lilly and lawyers for plaintiffs said they were pleased with the agreement. With global sales of roughly $4.2 billion last year, Zyprexa is Lilly’s largest-selling drug and a major contributor to the company’s profits. Lilly shares were relatively flat after the settlement announcement. They rose 11 cents yesterday, to $52.36.
Zyprexa is the brand name for olanzapine, a potent chemical that binds to receptors in the brain to reduce psychotic hallucinations and delusions. Clinical trials show that in many patients, Zyprexa also causes severe weight gain and increases in cholesterol and blood sugar.
Documents provided to The New York Times last month by a lawyer who represents mentally ill patients show that Lilly played down the risks of Zyprexa to doctors as the drug’s sales soared after its introduction in 1996. The internal documents show that in Lilly’s clinical trials, 16 percent of people taking Zyprexa gained more than 66 pounds after a year on the drug, a far higher figure than the company disclosed to doctors.
The documents also show that Lilly marketed the drug as appropriate for patients who did not meet accepted diagnoses of schizophrenia or bipolar disorder, Zyprexa’s only approved uses. By law, drug makers may promote their drugs only for diseases for which the Food and Drug Administration has found the medicines to be safe and effective, though doctors may prescribe drugs in any way they see fit.
In response to questions about the information in the documents, Lilly has denied any wrongdoing and said it provided all relevant information to doctors and the F.D.A. Lilly has also said it did not promote Zyprexa for conditions other than schizophrenia or bipolar disorder.
In 2004, a panel of the American Diabetes Association found that Zyprexa caused diabetes more than other widely used antipsychotic drugs, in part because it tends to cause much more weight gain. But the F.D.A. has never made a similar finding. Instead, the F.D.A. added a warning in 2003 to the label of Zyprexa and other new antipsychotic drugs about their tendency to cause high blood sugar.
In 2005, a $700 million agreement covered 8,000 patients, and the company has made 2,500 individual settlements whose total value has not been disclosed, Lilly said. The 2005 settlement valued claims at about $90,000 a plaintiff, while yesterday’s agreement values claims at about $27,000 a plaintiff, at most.
The lower value for the new claims comes in part because of the F.D.A. label change, which has allowed Lilly to say that it adequately warned doctors of the risks of Zyprexa after 2003. The label change may also help to protect Lilly from future lawsuits, analysts and lawyers say.
In its statement, Lilly said the settlement did not change its view that Zyprexa is a safe and effective treatment for mental illness.
“We wanted to reduce significant uncertainties involved in litigating such complex cases,” Sidney Taurel, Lilly’s chief executive, said in the statement.
Richard Meadow, one of the lead lawyers for the plaintiffs, said the deal was fair to both sides. “Prolonging this litigation further is in no one’s best interest,” he said.