(photo credit: Ariel Jerozolimski)
Teva Pharmaceutical Industries Ltd. won a legal victory in the United
States on Thursday worth about $500 million to the company. By a majority of
five to four, the US Supreme Court ruled that generic-drug companies cannot be
sued under state law over allegations they failed to provide adequate label
warnings about potential side effects.
In the lawsuit filed against
Actavis and Pliva, the Supreme Court ruled that makers of generic drugs did not
have to warn of side effects of drugs on their labels, as long as the maker of
the original drug did not do so.
The Supreme Court thus overturned an
Appeals Court decision allowing the lawsuit to proceed. The latest decision
represents a victory for Teva, Mylan Inc. unit UDL Laboratories and
Icelandic company Actavis Inc.
The generic-drug companies argued that
federal law did not allow such lawsuits, since the drugs were approved by the US
Food and Drug Administration.
They said federal law required that
labeling of generic drugs should be the same as for the equivalent ethical
In May 2010, Teva lost in a suit involving the same question, when
a Nevada court ruled that it must pay compensation of $256m. It also ruled that
Baxter Healthcare, which distributed the anaesthetic propofol, produced by Teva,
must pay compensation of $144m. to a patient anaesthetized using the
The propofol vials were reused at clinics in Nevada, leading
to an outbreak of hepatitis C. The court found that the labels on the drug had
failed to warn against reuse.
The current Supreme Court decision
overturns the ruling, saving Teva from having to make a huge
Generic drugs account for about 70 percent of drugs prescribed in
“Teva is pleased with the High Court’s decision [Thursday], which
provides great clarity for both the drug industry as well as patients,” Teva
said in a statement.
“This ruling reiterates that once the US Food and
Drug Administration approves a generic prescription drug as interchangeable to
the brand, their labels must also be identical in all material
“Accordingly, generic companies do not have the ability to
influence labeling and related information and should not be held liable for
failing to do so.
This is also a win for American consumers, as they bear
the ultimate burden of these lawsuits. The decision of the Supreme Court will
help to alleviate unnecessary litigation.”