Congress Vows to Continue Contaminated Heparin Investigation

Just weeks after the pharmaceutical giant, Baxter and its supplier, SPL lost the first contaminated heparin trial in Chicago for their role in the contaminated heparin crisis that killed hundreds of Americans, Congress has indicated that it has not given up on its three-year investigation to identify the original contamination source. (06/29/11 Press Release from the House Energy and Commerce Committee)

It is now well-known that in order to increase corporate profits, Baxter and SPL decided to purchase their  heparin (referred to in the companies’ own internal records as “the cheap stuff”) from an overseas Chinese facility that the companies knew had never been inspected by the U.S. FDA or any Chinese regulatory officials. (When the Chinese plant was finally inspected by the FDA after the heparin contamination crisis, multiple violations were found, resulting in an import ban.) It was also uncovered that Baxter and/or SPL completely failed to establish and conform with quality/purity specifications, including an impurity profile, failed to understand, let alone control, their supply chain, and did not conduct the testing that they promised the FDA they would conduct. The specific individuals who added the contaminant to over half of the nation’s supply of heparin, however, have never been identified.

On June 29, 2011, the House Energy and Commerce Committee indicated that it “firmly believe[s] discovering the root cause of the heparin crisis is an urgent matter of public health and that the public deserves long-overdue answers about the contamination of this widely used blood-thinning drug in order to prevent similar dangers in the future.” As a result, the Committee announced that it was expanding its investigation as to the original contamination source.

Committee Chairman Fred Upton, R-Mich., Chairman Emeritus Joe Barton, R-Texas, Health Subcommittee Chairman Joe Pitts, R-Penn., Health Subcommittee Vice Chairman Dr. Michael Burgess, R-Texas, and Oversight and Investigations Subcommittee Chairman Cliff Stearns, R-Fla., said they contacted 10 pharmaceutical companies because documents provided by the FDA indicated that they had information related to the Chinese heparin industry and Chinese heparin supply chains.

The leaders are seeking documents and information from Amphastar Pharmaceuticals, Momenta Pharmaceuticals, Siegfried USA, Inc., Sagent Pharmaceutical, APP Pharmaceuticals, Sanofi Aventis, Drug Source Company LLC, Global Pharma Sourcing LLC, Pacific Rainbow International, and Sandoz.

In their press release, the Committee leaders wrote, “We believe there is substantial public interest in solving this case. More than 80 percent of the U.S. unfractionated heparin supply is sourced from China and more than 16 percent of U.S. pharmaceutical ingredients are imported from China. There is reason to believe all or some of the individuals responsible for the adulteration are still actively engaged in the Chinese pharmaceutical supply chain and pose a continuing threat to pharmaceutical products imported to the U.S. How the heparin came to be contaminated and the exact nature of the contaminant remain unknown. It is important to determine how the adulteration happened so that industry and government can take more effective proactive measures to reduce the risk of such adulteration in the future.”

The Committee also faulted the FDA, whom the Committee indicated it has been “pressing” since 2008 “for answers about the agency’s handling of the investigation into the contaminated heparin.” As the Committee noted in its press release, “The U.S. Government Accountability Office also faulted some of the FDA’s efforts, including the decision to continue allowing drugs to be imported from Chinese facilities that refused to allow inspections.”

Responses from the companies are due July 29, 2011.

We commend the continued efforts of Congress to obtain additional answers, which are not only important to those who lost loved ones from contaminated heparin, including our clients, but those who may still be in danger from foreign-made pharmaceuticals.

However, we also continue to lobby for additional efforts and regulation to address the significant risk posed to Americans from foreign-made pharmaceuticals. As a senior Food and Drug Administration regulator warned just a few months ago, another public health crisis may be inevitable because the FDA can't guarantee the safety of many drugs and food products manufactured overseas. (CNNMoney.com, March 14, 2011.) "The safety of America's food and medical products is under serious challenge," John Taylor, FDA's acting principal deputy commissioner, said in an interview with CNN in March. Decades ago, Taylor said the agency had a better grip on ensuring the safety of those products because most of them were made in the United States. But today, he said, the agency is crippled in its mission to protect the health of Americans since a lot of medicine sold in the U.S. is made abroad and outside of strict FDA oversight. As a result, Taylor admitted that the safety agency must reinvent itself to operate more effectively globally, or "another public health crisis like Heparin seems inevitable."

Cook County Judge authorizes Punitive Damages in Contaminated Heparin

Yesterday Judge Duncan Brice handed down her decision in the Cook County litigation on Plaintiffs' Motion for Leave to amend to add claims for Punitive Damages.  The Judge ruled that Plaintiffs may amend their complaints to allege punitive damages against SPL, finding that there is a reasonable likelihood that Plaintiffs can prove facts at trial that will support an award of punitive damages. 

In making her ruling, the Judge found that there was evidence that SPL acted with such "gross negligence as to indicate a wanton disregard of the rights of others."  Although she found that there was evidence on the part of Baxter of negligence, she unfortunately did not find that the Baxter negligence rose to the level of wanton disregard for safety as to permit an additional award, like that of SPL.

The Court focused on the willingness of SPL to sell lots that failed galactosamine testing, the failure of CZSPL to pass a Sanofi Aventis audit in 2005 (which was 2 years before Baxter even audited), the failure to audit its crude suppliers, the failure of SPL to investigate the catastrophic failures of contaminated heparin sold to Beckman Coulter, the failure to investigate high galactosamine levels in heparin api intended for Momenta, the resale of these failed lots to other customers such as B Braun, Covidien and Medifil, and the failure to investigate the rejection of contaminated lots of 1060 contaminated heparin by Leo Pharma, which contained levels of contamination over 16%.

Judge Duncan Brice further rejected the Defendants' pleas to bifurcate the punitive damages aspects of the trials from the liability portion, ruling instead that the evidence is so intertwined that it would be prejudicial to plaintiffs to have to present the same evidence twice, and to incur the added expense and time that bifurcation would cause.

SPL is owned by American Capital (ACAS), which has $37 billion under management.  ACAS has been named as a responsible party in some of the pending cases.  Motions involving ACAS are pending in the MDL.

We will be posting the 27 page decision shortly.  We believe there is additional evidence which, once reviewed in more detail, will also support a further extension of the right to seek punitive damages against Baxter and intend to continue pushing for an award of punitive damages against Baxter as well as SPL.

Baxter gets yet another warning letter

Baxter's inability to make quality products and comply with FDA and GMP requirements was once more documented by the release of a Warning Letter:

CERTIFIED MAIL
RETURN RECEIPT REQUESTED

January 20, 2011

Mr. Robert L. Parkinson
Chairman, President, and CEO
Baxter Healthcare Corporation
One Baxter Parkway
Deerfield, IL 60015-4633

Dear Mr. Parkinson:

During our July 14 to August 26, 2010 inspection of your pharmaceutical manufacturing facility, Baxter Healthcare Corporation, located at No. 250 Road No. 144 Jayuya, Puerto Rico, investigators from the Food and Drug Administration (FDA) identified significant violations of Current Good Manufacturing Practice (CGMP) regulations for Finished Pharmaceuticals, Title 21, Code of Federal Regulations, Parts 210 and 211. These violations cause your drug product(s) to be adulterated within the meaning of section 501(a)(2)(B) of the Federal Food, Drug, and Cosmetic Act (the Act) [21 U.S.C. § 351(a)(2)(B)] in that the methods used in, or the facilities or controls used for, their manufacture, processing, packing, or holding do not conform to, or are not operated or administered in conformity with CGMP.

The inspection at Jayuya, Puerto Rico, also identified that your products are misbranded under section 502(f)(1) of the Act [21 U.S.C. § 352(f)(1)].

In addition, the inspection at Jayuya, Puerto Rico, and our September 21 - 30, 2010 inspection at the Baxter Healthcare Corporation, located at Route No. 3 KM 142.5 Guayama, Puerto Rico, identified your firm’s failure to submit NDA Field Alert Reports (FARs) to the FDA as required by 21 C.F.R. § 314.81(b)(1)(i) and (ii), and section 505(k) of the Act [21 U.S.C. § 355(k)]. 

We have reviewed your firm’s response of September 15, 2010, and October 20, 2010, and note that they lack sufficient corrective actions.  

Incredibly, when Baxter made drug products that were  discolored and at risk of being cross-contaminated, instead of a recall it sent out a color chart, and instructed health care personnel to discard any products that failed to have the correct color!  The FDA refused to permit Baxter to shift the burden onto its customers of insuring Baxter's quality control.  The Letter stated "It is unacceptable to rely upon the health care professional to fulfill your Quality Control Unit responsibilities."

The end user should not be expected to make a determination of product safety and effectiveness based on a color chart that was not reviewed and approved by the Agency. It is your responsibility to ensure that your products comply with their predetermined specifications to ensure their quality, safety, and effectiveness."

The FDA found that the Baxter products were Misbranded under the Act.  The FDA also found evidence of dirt and insects in Baxter products.

It gets worse
Not only did Baxter's manufacturing practices and products  fail, Baxter also continues to be unable to comply with the duty imposed upon drug manufacturers to monitor products in the field after distribution:

A.    Post Marketing Reports

1.  Your firm failed to submit NDA Field Alert Reports (FARs) within three (3) working days of receipt of information concerning a product defect. This includes any bacteriological contamination, any significant chemical, physical, or other change, any deterioration in the distributed drug product, or any failure of one or more distributed batches of drug product to meet the specifications established for it in the application [21 C.F.R. §314.81(b)(1)(ii)].

Drug manufacturers have a serious obligation to not only make safe and effective products, but to also monitor those products in the field and report failures, adverse events, or other issues to the authorities.  Baxter continues to profit from its failures by making or purchasing drug products in facilities that do not comply with GMP, by not tracking its products to the end users, and by not recalling products completely and effectively when they do fail. Again, the quality failures here are the same quality failures that lead to the contaminated heparin debacle.

The full letter is available at FDA Website.

We continue to work towards obtaining the full release of all trial transcripts and exhibits from the recent trial.  The victims of the Heparin Disaster, and the public, need to know the truth.

UPDATE:  At Fierce Pharma there is the following comment:
Both the Jayuya and Guayama facilities fell down on reporting product defects to the FDA, the agency maintains. Inspectors found 43 consumer complaints concerning discoloration of an amino acid injection--varying from dark yellow to dark brown--dating to February 2010. Yet no report was filed with the FDA. And despite receiving some 40 complaints regarding particle contamination in another product, which initiated a health hazard assessment, Baxter neglected to file a field report.

Read more: Baxter gets warned on missing field reports - FiercePharma Manufacturing

Jury Finds Against Baxter Healthcare In Nation’s First Contaminated Chinese Heparin Case

FOR IMMEDIATE RELEASE


(Chicago, June 9, 2011) Today a Cook County jury awarded $625,000 to the estate of a 63 year old Chicago area man, Steven Johansen, who was administered Baxter blood thinner that contained a contaminated ingredient Baxter sourced from China. This was the first of hundreds of pending lawsuits on Baxter contaminated Chinese heparin to go to trial. The lawsuits are pending in the Circuit Court of Cook County in Chicago, Illinois before Judge Jennifer Duncan-Brice and in the U.S. Northern District Court in Toledo, Ohio before Judge James G. Carr. The contaminated heparin crisis and resulting lawsuits received national attention and sparked congressional investigation as they exposed deficiencies in the regulatory oversight of drugs imported from China and other developing countries, and the failure of American drug companies, eager to increase profits by outsourcing, to monitor those foreign suppliers.

The blood thinner was manufactured in part in China and sold by the U.S. drug company, Baxter Healthcare Corporation and its supplier, Scientific Protein Laboratories, L.L.C. (SPL). It was recalled in early 2008 following an alarming and unexpectedly high rate of reported adverse events and deaths that resulted in a national healthcare crisis. The contaminate was determined to be a man-made “fake heparin” called over-sulfated chondroitin sulfate (OSCS), causing among other effects, potentially fatal allergic-like reactions.

The active pharmaceutical ingredient in the contaminated heparin received by Mr. Johansen and other Americans was obtained from Baxter/SPL’s Chinese supplier, Changzhou SPL (a joint venture with SPL). This  heparin api  was referred to in the companies’ own internal records as “the cheap stuff.” Baxter and SPL knew that the plant had never been inspected by the U.S. FDA (which the FDA later attributed to clerical error) or Chinese regulatory officials. When the Chinese plant was finally inspected by the FDA after the heparin contamination crisis, multiple violations were found resulting in an import ban. Additional evidence also brought to light during the trial established that Baxter and SPL failed to establish and comport with quality/purity specifications, including an impurity profile, and failed to trace and control their supply chain. At trial, the Court granted partial directed verdict in favor of Mr. Johansen holding that the product sold by Baxter and SPL was defective as a matter of law.

Plaintiffs contended Mr. Johansen received low doses of contaminated heparin during dialysis and a bolus dose during a subsequent hospitalization at Palos Community Hospital on December 12, 2007. Following a code, Mr. Johansen died a day later, on December 13, 2007. Baxter and SPL argued that Mr. Johansen died from sepsis and that he was already in poor health. As noted by co-lead attorney David Zoll from Zoll, Kranz & Borgess in Toledo, Ohio (co-counsel with Chicago attorney Donald Nolan of Nolan Law Group), “Heparin is supposed to be a life-saving drug, not a life-taking drug. Baxter’s defense is that these people were already sick. However, this is all the more reason why they needed a life-saving drug. The medical needs of a patient don’t excuse their failures.”

----
To our blog readers
Because of the power of the internet we took this blog down during the trial to avoid the influence of any jurors.  We will begin publishing our past blogs shortly, and will be adding new information that, up until now, we have been forced to hold in confidence.  The trial exhibits and testimony will soon be public knowledge.  We look forwards to publishing the documents that reveal the facts behind the shoddy quality controls and workmanship of Baxter and SPL that, in part,  lead the Judge to award a partial directed verdict in favor of Plaintiffs.

Sadly Illinois law does not permit an award of punitive damages in a wrongful death case; however there are other cases yet to be tried that will permit us to pursue these damages.
 
We thank the brave members of the Johansen family for their perserverance in the face of a sophisticated and extensive defense, and our expert witnesses who did so well under fire.
 
The Nolan Law Group is one of the premier law firms in the country and we were deeply honored to work side by side with them on this important case.
David & Pamela

Update: Chicago Tribune story:  Baxter loses first Heparin case.

Wall Street Journal (subscription required): Jury Rules Against Baxter in First Contaminated Heparin Case.

FDA: Another tainted drug crisis seems inevitable

The following article came out today in CNN Money and shows why it is so important that drug companies be held accountable for tainted drugs that they choose to manufacture overseas in order to increase corporate profits.

A senior Food and Drug Administration regulator warned that another public health crisis may be inevitable because the agency can't guarantee the safety of many drugs and food products manufactured overseas.

"The safety of America's food and medical products is under serious challenge," John Taylor, FDA's acting principal deputy commissioner, said Monday.
He said the safety agency must reinvent itself to operate more effectively globally, or "another public health crisis like Heparin seems inevitable."

In 2008, contaminants in Heparin, a blood thinner being produced in China, led to more than 100 deaths in the United States.

The FDA is responsible for overseeing the safety and manufacturing quality of food, drugs, medical devices, vaccines, cosmetics and tobacco products.

Speaking at the Pew Health Group conference in Washington D.C., Taylor said the FDA can't keep up with how quickly manufacturing has shifted overseas.

Decades ago, Taylor said the agency had a better grip on ensuring the safety of those products because most of them were made in the United States.

But today, he said, the agency is crippled in its mission to protect the health of Americans since a lot of medicine sold in the U.S. is made abroad and outside of strict FDA oversight.

40% of drugs consumed in the United States are imported, while 80% of the ingredients used in U.S. drugs come from other countries.

And food imports have grown on average 10% each year for at least 7 years, he said.
"Today, there are more than 130,000 importers of record and more than 300 ports of entry in the United States," he said.

Taylor said the FDA's difficulty in monitoring imports is also leading to more counterfeit and adulterated products entering the U.S.

One recent high-profile incident was the contaminated Heparin from China that killed more than 140 people in the United States. Other incidents include toothpaste from China containing Diethylene Glycol -- used in antifreeze -- counterfeit Lipitor from Central America and counterfeit glucose monitor test strips.

The next few years, he said, are critical for the agency to transform itself to adapt to the global challenges.

Taylor provided a glimpse of what he called the FDA's "global strategy and action plan."

Among his key points: the FDA will partner with its foreign counterparts to create a global coalition of regulators; it will boost intelligence gathering and the agency will encourage consumers and the private sector to help in its efforts.
"Regulators cannot do it alone," said Taylor.

“60 Minutes” Program on Counterfeit Drugs, Including Contaminated Heparin, to Air this Sunday, March 13, 2011

CBS’ news program, 60 Minutes, will air a program on counterfeit drugs including, contaminated heparin, this Sunday, March 13, 2011 at 7 p.m. ET/PT.

60 Minutes’ website describes the program as follows:

“In this program, Dr. Sanjay Gupta investigates the counterfeit drug trade, revealing an international web of manufacturers and distributors whose dangerous and often deadly products are extremely hard to keep out of the world's drug supply.
The nine-month "60 Minutes" investigation begins by reporting on a special global security team assembled by American pharmaceutical firm Pfizer. The team contains former federal law enforcement agents and tracks counterfeiters and their products around the world with the help of local police. Pfizer's team identifies a fake drug factory in Lima, Peru, and Gupta and "60 Minutes" cameras accompany a raid by Peruvian police.

The factory was producing hundreds of thousands of counterfeits of real brands with convincing labels and imprints. Some are so exact, technicians at the pharmaceutical companies whose brands they are counterfeiting cannot tell them apart without using sophisticated tests. The fakes usually find their way into people's medicine cabinets via illegitimate Internet pharmacies, from which an estimated 36 million Americans have purchased medicines.

From Peru, "60 Minutes" goes to the computer command center of Immigration and Customs Enforcement, which tracks the intricate web of counterfeit-drug producers and distributors around the world. The investigation then follows packages of suspicious medicines through U.S. Customs and FDA inspection at JFK international airport and visits the FDA laboratory where they are tested.

The fakes sometimes have small amounts of the right active ingredient, but often contain substances like sugar or chalk - dangerous enough because it is useless against the illness. But counterfeits have also made their way into the legitimate drug supply and have been found in bulk raw ingredients sold to companies making legitimate drugs with them. The FDA has linked American deaths to a blood thinner found in 2008 to contain a raw ingredient from China that was counterfeit.

Three years after those deaths, Gupta asks FDA commissioner Margaret Hamburg how the crime was perpetrated and by whom. "We do not know the answer to that question," she responds. Assuring him that the vast majority of the drug supply is safe, Hamburg allows there is still reason for concern.

"We do know that in certain countries, somewhere between 30 and 50 percent of really important drugs...are in fact, counterfeit," she says. "Just consider that 40 percent of drugs taken in this country come from other countries. Eighty percent of the active pharmaceutical ingredients in drugs taken in this country actually come from other countries," she tells Gupta.”

To view a clip of this program, click here.

Money Well Spent? Baxter lobbies for advantages

Bloomberg reported yesterday that Baxter spent $930,000 in the third quarter of last year on lobbying efforts, which included efforts opposing tracking drug ingredients manufactured overseas. Bloomberg noted:

The Deerfield, Ill., company lobbied on bills that would increase tracking of drug ingredients manufactured overseas. In 2008, Baxter was forced to recall all of its blood-thinning heparin drugs because of contamination that was later traced to a Chinese plant.

 Baxter has lobbied against requirements for tracking of drugs since at least 2006.  Baxter's inability to track lot numbers to institutions that bought its contaminated product is now being used as a defense by Baxter to avoid responsibility for death and injury caused by its contaminated products.

The term ‘drug pedigree’ refers to a record of the chain of custody of a product as it moves through the supply chain from manufacturer to pharmacy. On February 24, 2007, Baxter submitted its official opinions in a letter to FDA to comment on the FDA’s proposed regulations regarding prescription drug pedigree. Baxter’s letter to FDA, Docket Number: 2005N-0510, was signed by J. Andrew Harrison, Manager, Global Regulatory Affairs, Baxter.

In Baxter’s letter to the FDA, Baxter argued for exemptions to be made from proposed pedigree requirements for drugs when in “normal chain of distribution.” Baxter urged FDA to consider the consequences of pedigree requirements on cost to consumers. Baxter also argued against use of new technology and RFID tags to facilitate pedigree record-keeping for drugs. Baxter did support a limited and/or phased-in, risk-based approach to track and trace technology.

According to Bloomberg, Baxter spends about $900,000 a quarter, or over $3.5 million a year, in its efforts to seek favorable treatment from Congress and the FDA.