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July 2013

Gordon & Rees Partner Kai Peters Quoted in the Daily Journal on U.S. Supreme Court Pharmaceutical Preemption Opinion

Gordon & Rees San Francisco partner Kai Peters was quoted in the June 25 issue of the Daily Journal. In the article, titled “Defense Lawyers Cheer High Court’s Ruling on Generic Drugs,” Peters discussed the U.S. Supreme Court’s June 24 opinion in Mutual Pharmaceutical Co., Inc. v. Bartlett, which protects generic drug makers from lawsuits over design defects.  The case is one of the most watched opinions for pharmaceutical litigation in 2013 and continues to define the intricate area of preemption of state law claims involving generic pharmaceuticals.

The Bartlett decision addressed whether design defect claims asserted against manufacturers of generic pharmaceutical products are preempted.  In overturning the U.S. Court of Appeals for the First Circuit, the Supreme Court held in a 5-4 decision that state law design defect claims were preempted by federal law.  A key to the decision was the fact that the manufacturer is prohibited from making any major changes to the “qualitative or quantitative formulation [design] of the drug product, including active ingredients, or in the specifications provided in the approved application.”  See 21 C.F.R. §314.70(b)(2)(i).  Since the manufacturer could not change the design, the only remaining avenue for the plaintiff to prove her design defect claim under state law was to show that the drug’s labeling should have been changed.  The plaintiff was likewise foreclosed from making such arguments under the Supreme Court’s landmark 2012 decision Mensing v. Pliva, in which it held that the state law failure to warn claims at issue in the case were preempted as generic manufacturers cannot change the product labeling.

Peters explained that if generic pharmaceutical manufacturers are going to be held liable now in similar circumstances, that’s a decision that will have to come out of Congress or the U.S. Food and Drug Administration.  While manufacturers of generic pharmaceuticals may still potentially be held liable if they fail to update their labels properly, the opinion further curtails potential claims that may be asserted.  Peters also described how the decision would likely encourage more cases brought in California under the Conte v. Wyeth ruling, in which brand-name manufacturers responsible for the label may potentially be held liable when generic pharmaceuticals are ingested.  Peters noted that, “California is just a magnet for this kind of litigation.”

Peters has significant experience in litigation, including product liability, mass torts, class actions, breach of contract, and business disputes. He has a particular emphasis in complex commercial litigation representing pharmaceutical, medical device, and other FDA-regulated companies; solar companies; and hi-tech and new media companies. Peters acts as national and local litigation counsel for companies of all sizes in state and federal courts, including in multidistrict litigation and in coordinated proceedings.

Kai Peters