That sounds crazy, I know. But here’s my logic.
The vast majority of pharmaceutical lawsuits are brought under what’s called a failure to warn theory of liability. Failure-to-warn lawsuits allege that a manufacturer of a drug didn’t accurately inform a plaintiff about the risks associated with taking a specific drug. If the manufacturer does give an adequate warning about the risks of a drug, you basically can’t sue the manufacturer if you’re hurt.
The way in which manufacturers warn the public is through the drug’s label. The label includes the very lengthy package insert that describes the risks of the drug. The pharmaceutical companies write that label in cooperation with the FDA. In other words, they don’t get to just put whatever they want there. Whatever they put in the label has to be supported by evidence and approved by the FDA.
So, the solution is simple: pharmaceutical companies could fully disclose all of the known risks of taking a drug on the drug’s label. If they did that, there wouldn’t be anymore failure to warn litigation. Case in point: Ortho-Evra. If someone uses the patch today and suffers from a pulmonary embolism tomorrow, no lawyer will take the case because the label FINALLY has a strong warning about the risks of a pulmonary embolism.
So why don’t the pharmaceutical companies disclose all the risks of a drug in the first version of a label? Because stronger warnings lead to lower sales. In other words, the drug companies would rather sell more drugs and get sued than sell less drugs and not get sued. So clearly it must be more profitable not to warn consumers and to get sued than it would be to virtually eliminate all lawsuits.
There’s even a safety valve built into the system that prevents a pharmaceutical company from writing a ridiculously overbroad warning label: The FDA. As I mentioned, there must be evidence to support everything in a label. Any warnings that aren’t justified will be rejected by the FDA. And if by some chance, the FDA rejects a warning that it shouldn’t have, the pharmaceutical company is still safe: It’s tough to win a failure to warn lawsuit if the warning was specifically rejected by the FDA.
The pharmaceutical companies therefore have it within their power to get rid of nearly all tort lawsuits against them. But they choose not to. I believe that they choose not to because it is more profitable to sell additional drugs and use the profits to pay the people who are injured and do sue.
Am I wrong?