RICO Act -- 2017



Sidney Hillman Health Ctr. v. Abbott Labs., Inc.   (7th Circuit)

RICO drug pricing case -- proximate cause issue

The NAM filed an amicus brief arguing that pharmaceutical companies should not be subject to treble damages under the Racketeer Influenced and Corrupt Organizations Act (RICO) for injuries allegedly arising from misrepresentations to doctors about the efficacy of a prescription drug. A group of plaintiffs sued pharmaceutical company Abbott Labs alleging that the company’s misrepresentations about the drug, Depakote, caused the plaintiffs’ injuries under RICO. If courts allow RICO claims against pharmaceutical manufacturers for alleged misrepresentations to doctors, the potential liability could chill the development of new medications and impair patient safety. The NAM’s brief argued that multiple intervening factors broke any causal link between the defendant’s statements and plaintiffs’ injuries, thus the plaintiffs’ injuries were not directly caused by the defendants’ statements. In a win for manufacturers, the court accepted NAM’s argument and held that any connection between misrepresentations to doctors and claims for damages by third-party payors is too remote to prove causation.


Related Documents:
NAM amicus brief  (June 12, 2017)