November 9th, 2011

Continental European Legislative and Judicial Trends: Who Shall Bear Monetary Compensation for Victims of Mediator® in France?

Posted at 1:00 AM ET

David Lewin, Managing Director
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The scandal surrounding the Mediator® diabetes drug (benfluorex hydrochloride) was revealed by Dr. Irene Frachon in June 2010 in her book, whose title could not be more explicit - “Mediator 150 mg - How Many Deaths?” This title triggered the first of many legal battles with Servier Laboratories, the manufacturer of the Mediator drug. While Servier won the first round, when judges ordered that “How Many Deaths?” be deleted from the book’s title, the Court of Appeal of Rennes later allowed the subtitle, emphasizing that the book was contributing to a legitimate debate regarding the Mediator case.

The Mediator public health scandal has been the focus of major media exposure in France, and there are even plans to make Dr. Frachon’s book into a movie. The case has also aroused interest outside France since the Mediator drug was marketed abroad for many years. The drug was removed from several foreign markets following reports of cardiac valvulopathy and pulmonary arterial hypertension, long before benfluorex-containing medicines were banned in France.

From 2006 until 2009, the Mediator drug was available only in Cyprus, Portugal and France after the drug’s marketing authorizations were revoked throughout Europe. In the United States and Canada, the drug Dexfenfluramine, marketed by Servier under the name Redox (and the name Isomeride in Europe), triggered the huge “Fen-Phen” (the drug combination fenfluramine/phentermine) scandal. These medications are chemically similar to Mediator and are said to be “cousins” of the drug.

Public interest in the drug is not surprising, given the severe heart-valve diseases suffered by some who took the Mediator drug during the 33 years they were available on the shelves of every French pharmacy. The five million people who took the drug from 1979 to 2009 and their close relatives are concerned about the side effects of Mediator. Some 500 to 2,000 persons are believed to have died due to exposure to benfluorex, the active ingredient in the Mediator drug.

Hundreds of criminal claims have already been submitted against Servier. Criminal proceedings are currently ongoing before the Criminal Court of Nanterre for aggravated deception and before the Criminal Court of Paris for involuntary manslaughters and unintentional injuries. The first criminal trial in the Mediator case is scheduled to make place in Nanterre in Spring 2012.

In addition to criminal and civil claims before courts, Mediator victims may be able to seek indemnification from an ad hoc state compensation fund that should be operational by the end of 2011. The French State has moved swiftly to create this fund, especially when compared with its slower response to other major public health scandals, including HIV /Hepatitis C contaminated blood, Creutzfeldt-Jakob disease and the growth hormone scandal. Moreover, this prompt reaction stands in stark contrast to the suspected delay in the French government’s withdrawing the marketing authorization for the Mediator drug. As a result, nine former French Health Ministers have reported to commissions set up at the highest level of the State, and one of them admitted to pressure from Servicer and the firm’s close ties to French politicians.

The draft bill creating a state compensation fund for benfluorex victims was adopted by the Council of Ministers of France in May 2011, passed into law on July 6 and validated by the Constitutional Council on July 28. The law is expected to become effective by September 1, 2011.

From a financial point of view, former users of the Mediator drug are not the sole victims of the scandal. The French State has already sustained major financial damages due to the Mediator issue. In addition to its status as a victim of Mediator, the state may be liable as well for damages stemming from the drug’s use because of breaches in the duties of drug-related government agencies.

Victims of the Mediator Drug in France

Mediator Drug Users

Mediator victims sustain heart valves damage, causing pain, suffering and early death, as well as preventing them from participating in normal activities. They must undergo medical treatment and/or surgery, including lung transplants for the most severe cases.

Victims’ associations have made significant progress in the indemnification process. To encourage victims to claim indemnification, some of these associations are crossing the country to inform Mediator users of their rights. The associations are fighting for all victims to obtain full compensation for damages, in light of the fact that class actions do not exist under French law. Health Minister Xavier Bertrand has rejected Servier’s proposal to offer compensation only to a limited category of victims and to cap the damages. The act setting up the compensation fund provides indemnification for all damages. Nevertheless, victims fear that they will not obtain full compensation because the Health Minister admitted that compensation per victim may be limited, even though the total compensation amount would not be.

The French State

The National Insurance Fund (CPAM, Caisse Primaire d’Assurance Maladie) has borne the charge for the reimbursement of the Mediator drug, valued at EUR879 million. It now bears the costs of medical treatments that Mediator victims must receive as a result of the drug’s use.

The French National Office for Accidents of Medical Nature (ONIAM, Office National d’Indemnisation des Accidents Medicaux) will make advance payment for damages of victims claiming indemnification from the state compensation fund. This will occur if the “responsible person” at the individual victim’s insurer fails to offer compensation or makes an obviously insufficient compensation offer within the allotted period of time. This period is set at three months from the day the pool of experts for the state compensation fund has rendered its opinion. It opines on the  circumstances, the causes, the kind and the extent of the damages and the liability of benfluorex drug manufacturer/distributors, and possibly, the liability of other health professionals as listed under the Public Health Code. These professionals are all subject to mandatory professional liability insurance.

As far as Servier is concerned, one of its four liability insurers publicly declared in January 2011 that its coverage has excluded damages caused by anorexigens (appetite suppressants) since 1997, following the Redox/Isomeride scandal. Therefore, coverage to Servier would be denied if the Mediator drug is deemed an anorexigen. The General Social Policies Inspectorate (IGAS, Inspection Generale des Affaires Sociales) affirmed that the Mediator drug was an anorexigen in a report published on January 15, 2011. The denial of insurance coverage, and most likely also that of Servier’s three other insurance companies, should not impact the drug maker’s ability to compensate Mediator victims, considering its profits of EUR378 million and cash flow of EUR2 billion.

Under the act passed in July 2011, any persons deemed responsible, or their insurers, may receive a penalty when failing to make an indemnification offer or offering obviously insufficient compensation in settling a benfluorex victim’s claim. This penalty is capped at 30 percent of the compensation paid by the state fund.

The Health Minister has emphasized on various occasions that taxpayers will not bear the burden of indemnification paid by the compensation fund. Instead, the government will claim that Servier, or any jointly responsible persons, repay compensation disbursed from the fund, in addition to their penalty. However, if the State is held liable for lack of vigilance, French taxpayers will ultimately bear part of the victim compensation costs.

Responsible Persons for Damages Caused by Mediator Drug in France

In July, a French newspaper reported that medical experts, in three and a half years of research, had not identified a cause other than the use of the Mediator drug for the heart damage suffered by patients. This is the first time medical experts have established a causal link between using the Mediator drug and severe heart valve damage. This conclusion is promising to those who are working to expose Servier’s potential liability. Additional medical tests are underway.

In addition to Servier, the French State may be liable for delay and negligence in withdrawing the Mediator drug, and medical doctors may be blamed for prescribing the Mediator drug for use outside of its marketing authorization, for example, as a diet pill.

Servier, Mediator Drug Manufacturer

Victims claim that in early 1995 - 15 years before the Mediator drug was banned in France - Servier knew that the drug could cause severe heart damage. Last May, a newspaper revealed that a study done in 1993 by two researchers of Servier’s U.K. subsidiary found norfenfluoramin concentrations in the blood of Mediator users. Norfenfluoramin, one of the chemical compounds that the Mediator drug is converted to, was the active ingredient in Servier appetite suppressants Isomeride and Ponderal, which were identified in 1995 as responsible for causing pulmonary arterial hypertension.

Had Servier not denied the connection between Mediator and the Isomeride/Ponderal drug, the Mediator drug could have been banned as early as 1997 when Isomeride and Ponderal were withdrawn from the market. Yet according to Servier, no one knew there was a problem with the Mediator drug before 2003. In its view, Servier maintains that the responsibility to victims should be split between the firm and the State.

The French State

Victims claim that the French State did not fulfill its duty of vigilance. In this view, the State ignored the safety alerts regarding the dangers of appetite suppressants that were known since 1995.

The French Health Products Safety Agency (AFSSAPS, Agence Française de Sécurité Sanitaire des Produits de Santé) should have taken action following the removal of appetite suppressant Isomeride from the French market in 1997, and the withdrawal of Mediator from Italy and Spain in 2004 and 2005, respectively. The general director of AFSSAPS was dismissed in early 2011 due to the Mediator scandal. At that time, the Health Minister made it clear that he wanted transparency and independence in order to restore confidence in the French government’s oversight of drugs.

According to victims, Mediator should have been taken off the market no later than 1999 if the State and its agencies, including AFSSAPS and Haute Autorité de Santé, had examined the consequences of the withdrawal of Mediator abroad and tackled conflict of interest issues. Following its investigations, the IGAS has actually admitted that Mediator should have been banned beginning in 1999.

Other Possible Responsible Persons

  • The criminal claims filed with the Court of Nanterre are directed not only against Servier, but also against Jacques Servier in his capacity as president of the firm, and against Biopharma, the company who marketed the Mediator drug.
  • At the EU level, two French Euro-deputies have requested an investigation regarding an alleged lack of reaction from the European Medicines Agency (EMA). The EMA and the AFSSAPS, which have members in common, have a close relationship, which has raised concerns over conflicts of interest.
  • Doctors may be liable for prescribing Mediator as a weight loss drug, which was outside its marketing authorization. According to unofficial sources, the French government considered requesting medical doctors contribute to victims’ compensation. Some observers understood the ONIAM, which is in charge of the compensation fund, to announce that medical doctors would be joined to legal actions brought against Servier, but the ONIAM denied this interpretation. Medical doctors’ unions claim they too were deceived by Servier with regard to the composition and dangers of the use of the Mediator drug. Therefore, they maintain that they cannot be blamed for prescribing a medication that was authorized by the State’s health authorities.

Commentary

The Mediator scandal will remain in the spotlight for a long time, even as an additional scandal involving Servier may  be emerging. According to the AFSSAPS, Servier’s osteoporosis drug, named Protelos, may have triggered severe adverse reactions, including the deaths of two patients. The battles against Servier are only beginning.

The state compensation plan for Mediator is not yet operational. Victims are expected to be able to file with the ONIAM by the end of this year. It will be months before experts recognize the liability of the involved parties for either indemnification proceedings or legal actions before courts.

The question of insurance coverage remains open and will depend upon the conclusions drawn by the experts and court rulings in cases filed by victims or the ONIAM against Servier. Insurers should be joined parties in these cases. Technical issues will be central to the debates, from both a legal point of view and also with regard to the definition of health products and their conditions for use. At this stage, the exclusion of the insurer’s coverage has not been disputed, but the amounts at stake are so high that such an exclusion clause will most likely be scrutinized.

As far as professional insurance of medical doctors is concerned, the recent developments in medical liability in French law have led to dramatic increases in the insurance premiums of specialists such as obstetricians, surgeons and anaesthetists. If general practitioners are held responsible for prescribing a hazardous medication that received approval from health authorities, then it may become increasingly difficult and expensive for these doctors to obtain insurance coverage. These potential insurance issues could potentially discourage medical practice.

The liability issues raised in the Mediator matter are affecting paramedical professions as well, including medical representatives whose role is to promote pharmaceutical companies’ medications to doctors and hospitals. A report  of the IGAS, released last June, recommends that these medical representatives no longer be authorized to perform these activities. Additionally, the Health Minister’s bill for large-scale reform of pharmacovigilance states that medical representatives cannot meet “face to face” with doctors in French hospitals, and that only group meetings are  permitted. The Health Minister added that this prohibition may be extended to private practice physicians as well.

Undoubtedly, there will be a demarcation in the French medical and paramedical landscape dividing the situation into “before and after” periods around the Mediator scandal. The Health Minister clearly stated that “[pharmaceutical] laboratories must understand that things have changed” in regard to reform of medicine control. He emphasized that the benefit of the doubt will go to patients, not drug laboratories, moving forward.

Recent cases involving the diabetic medicines Actos® and Competact®, made by Takeda Laboratories, provide a good example of the government’s willingness to lay full responsibility on drug laboratories and to shift to drug makers the burden of proving an absence of risks. These two drugs were withdrawn in France and Germany in early June due to bladder cancer concerns. However, the EMA decided to maintain the marketing authorizations of these drugs. Despite this recommendation from the EMA, the French Head Minister made it clear that the Actos and Competact medicines will not return to French pharmacies.

The impact of Mediator and other potentially hazardous drugs is shifting the medical environment in France. The precautionary principle now incorporated into the French Constitution may ultimately enlarge the scope of liabilities in medical and paramedical activities. The liabilities have already broadened in recent years through development of new laws and results of court cases. This expansion of liabilities is leading to a growth in professional liability insurance premiums. It also raises significant questions for insurers around how these new risks should be covered.

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