Limits on lawsuits would lift supply, vaccine makers say
Boston Globe
By Diedtra Henderson, Globe Staff
WASHINGTON -- The Bush administration says the nation can better prepare for a global flu outbreak if private industry is protected from the threat of multimillion-dollar liability lawsuits, but critics fear that could shield companies that act negligently.
A draft bill prepared by the administration not only protects manufacturers of vaccines, antiviral therapies and devices, but also distributors, healthcare facilities where inoculations would be given, and the doctors and nurses who administer the shots. They would be largely protected from lawsuits if someone died or suffered serious side effects from therapies rushed to market to stave off a flu epidemic. In most cases, laboratory researchers working on a potential pandemic cure would be granted the same immunity.
Under the administration's plan, even when someone could sue for willful misconduct, they would face restrictions on where and how they could file lawsuits. And juries would be barred from awarding punitive damages, the sometimes jaw-dropping sums that have forced companies into bankruptcy.
Bush, who has long been critical of large jury awards, signaled his support for lawsuit protection last year, when there was a shortage of flu vaccine and the administration was faulted for poor planning. Vaccine manufacturers, summoned to the White House recently as the administration polished its pandemic preparedness plan, said liability protection would spur more domestic vaccine production.
The president this month called on Congress for an emergency appropriation of $7.1 billion to stockpile vaccines and antiviral drugs, to ease barriers that limit the number of manufacturers who produce vaccine domestically, and to provide financial incentives to modernize aging vaccine technology so manufacturers can quickly increase production should a pandemic occur.
Liability is ''the number one issue that faces vaccine manufacturers," said John Clerici, a partner with McKenna Long & Aldridge, a Washington, D.C., firm whose clients include domestic vaccine manufacturers. ''There have been no large judgments against vaccine makers that juries have brought down. Yet, the industry has spent over $250 million defending lawsuits across the country. The litigation costs alone aren't worth it. The uncertainty of the market is not worth it."
A once-robust field of 27 domestic vaccine producers 25 years ago has dwindled to nine domestic manufacturers, and only one company, Sanofi Pasteur Inc., produces flu vaccine in the United States.
Opposition to the Bush plan is building among Democrats, who say the nation's frail vaccine production system can be strengthened without punishing Americans who might be harmed by a vaccine or procedure.
''If this goes forward, drug companies would get away with gross negligence and recklessness, while those who are injured would be denied the compensation they deserve," said US Senator Edward M. Kennedy, Democrat of Massachusetts.
Still, many in Washington expect the measure will ride into law on the wave of worry that the nation is ill-prepared for a global flu outbreak.
''What I've seen with liability is if you say 'terrorist' or you say 'pandemic,' you're much more likely to get the shield because you're saying there is this sort of flag: national interest," said Victor E. Schwartz, general counsel for the American Tort Reform Association. ''That moves Democratic senators away from the plaintiff lawyers' column."
The Bush plan, outlined in a Nov. 1 letter from Department of Health and Human Services Secretary Michael Leavitt to House Speaker J. Dennis Hastert, is among a number of Republican-led measures under consideration to cope with the threat of avian flu and a possible biological attack launched by terrorists.
Leavitt is scheduled to testify before the House about pandemic planning today. US Representative Darrell Issa, Republican of California, has sponsored a bill providing liability protections to treatment for pandemics and illnesses caused by bioterrorism acts. Senate options include a bioterror bill with liability shields and patent extensions cosponsored by US Senator Richard M. Burr, Republican of North Carolina.
Burr said his proposal preserves legal remedies for people harmed by intentional wrongdoing.
''If companies knowingly do things and produce products that they know might have harm, they should be liable," he said.
But Chris Mather, a spokeswoman for the Association of Trial Lawyers of America, said she doubts manufacturers would be held responsible for wrongdoing.
''These big drug companies have a proven track record of putting their bottom line before the safety of the public, and eliminating the legal protections that allow average Americans to hold them accountable is dangerous," Mather said.
The fastest way to manufacture flu vaccine may be through an alternative process known as cell-based technology. While few serious side effects have accompanied seasonal flu vaccination, cell-based technology now in clinical trials is ''somewhat of an unknown world," Burr said. Successfully adopting such a process may be years away, specialists say.
Without liability protection, immunizing every American during a pandemic could produce a massive pool of people likely to file lawsuits, Schwartz said.
James Tyrrell Jr., a product liability attorney, worries about a part of Bush's proposal that would bar the information-gathering process known as discovery in the early stage of lawsuit.
That would be ''an extremely powerful weapon for the defendant," said Tyrrell, a senior partner at Latham & Watkins, in Newark, N.J.
''You're going to have to be able to show some kind of willful misconduct and proving intent is the toughest thing to prove," he said. ''And how you do that without discovery means that those who are benefited by this act can feel very comfortable that they will probably never be brought to justice in a court of civil law. What they did would have to be obvious and egregious for them to be held liable."
