Category Archives: Sales Marketing Vytorin Zetia Products Liability Litiga

MDL 1938: The RICO Violations — Amended Consolidated Complaint Counts

Yesterday, we looked at the newly-detailed “mechanisms of delay and/or negation” of the ENHANCE study results, all as allegedly carried out by Schering’s senior management. Today, we take a peek at the newly-detailed, and amended civil RICO (Racketeering) counts — beginning with paragraph 257 on page 80, et seq. [Here’s a link to the full PDF complaint file — Warning: very large download!]:

. . . .257. The predicate acts committed by Defendants were and are similar, continuous, and related. From at least 2004 to the present, Defendants were aware that they had no scientific basis to claim that Zetia and Vytorin, compared to Zocor alone, reduced or slowed the growth of arterial plaque. However, notwithstanding this knowledge, Defendants heavily promoted, and continue to promote, Zetia and Vytorin’s purported distinct mechanism of action as an advantage in treating high cholesterol, claiming overall health benefits as a result, including cardiovascular benefits. Defendants’ marketing of Vytorin consistently focused on reducing the health risk associated with high cholesterol, including plaque formation leading to heart disease, heart attack, and stroke. Defendants’ advertisements explained the nature of cholesterol, the difference between good and bad cholesterol, the fact that excessive LDL cholesterol levels cause arterial plaque formation, and the adverse health risks associated with excessive plaque, including heart disease, heart attack and stroke. Defendants have consistently marketed Zetia to payers, consumers, and physicians as a drug that lowers LDL cholesterol in a “different” manner, stressing that lowering LDL is important because LDL causes plaque to build up in arteries. Defendants’ website for Zetia is titled “A different way to fight cholesterol” (emphasis in original). It states, “ZETIA works differently,” going on to contrast Zetia with statins. Neither the Zetia nor the Vytorin website explained that the “different” or distinct ways these drugs work produces no cardiovascular benefits for the patients taking them. Defendants uniformly omitted all mentions of the ENHANCE study, which would have negated Defendants’ claims about the purported benefits of Zetia and Vytorin. This consistent message of a “different” approach to lowering cholesterol and the uniform omission of all mentions of the ENHANCE study illustrate how Defendants’ predicate acts of mail and wire fraud were similar, continuous, and related.

258. The victims of Defendants’ predicate acts of mail and wire fraud number at least in the hundreds of thousands, and may number in the millions based on the number of Zetia and Vytorin prescriptions and their volume of sales. The cholesterol-reduction market is the single largest pharmaceutical category in the world. Unlike Zocor, which is now subject to competition from generic simvastatin, Zetia and Vytorin command name-brand prices. Generic versions of Zocor sell for 75 cents to $1 per day at most retail pharmacies, and as little as 10 cents per day at discount pharmacies. Prescriptions for Vytorin and Zetia, on the other hand, each cost roughly $3 per day. Notwithstanding their high costs relative to available generic statins, Zetia and Vytorin represent nearly 20 percent of the American market for cholesterol-lowering drugs. In 2007, 800,000 prescriptions for Zetia and Vytorin were written weekly in the United States. Given this high volume of prescriptions, the number of victims of Defendants’ predicate acts of fraud number in the tens to hundreds of thousands.

259. Defendants’ fraudulent scheme involved the repetition of similar misrepresentations, which were made to hundreds of thousands of consumers, physicians, and health insurers.

260. Defendants’ scheme was calculated to ensure that Plaintiffs and the Classes would pay for Zetia and Vytorin despite the ready availability of less expensive, safer and effective alternatives.

261. Each of Defendants’ fraudulent mailings and interstate wire transmissions constitutes “racketeering activity” within the meaning of 18 U.S.C. § 1961(1). Collectively, these violations are a “pattern of racketeering activity” within the meaning of 18 U.S.C. § 1961(5). . . .

It just keeps pouring in Kenilworth.