Staying Ahead in Life Sciences Litigation: 2023 in Review and 2024 Trends – Part 1

As part of the life science community, Berkley Life Sciences (BLS) stays current on litigation trends and regulatory developments that affect the industry. BLS presents these updates in an annual webinar in partnership with Kim Schmid, Executive Managing Partner at Bowman & Brooke.

BLS is offering a series of three articles highlighting information from the webinar, such as a review of pertinent litigation and mass tort trends, new case law developments, regulatory updates, and what to watch for in 2024.

Part 1 of this series will focus on Multi-District Litigation (MDL) and nuclear verdicts and their impact on product liability cases of interest to life science organizations.

Multi-District Litigation: Leading the Way in Products Liability Cases

MDLS in Progress

As was the case in 2022, a significant portion of Multi-District Litigation (MDL) in 2023 consisted of products liability disputes, and many of these disputes centered around pharmaceutical and medical device products. Specifically, of the 167 MDLs pending at the end of 2023, 64 were product liability disputes, 36 of which concerned either pharmaceutical or medical device products.

The largest MDL in 2023 was the 3M Combat Arms Earplug Products Liability Litigation, MDL No. 2885, which now has the distinction of being the largest MDL in history. In this litigation, over 275,000 veterans sued 3M, the manufacturer of earplugs used in combat, alleging the products were defective, resulting in hearing loss or tinnitus. In August of 2023, 3M entered into a settlement agreement pursuant to which it agreed to pay in excess of $6 billion to resolve nearly 250,000 claims. The agreement was reached after the conclusion of sixteen bellwether trials, resulting in ten plaintiff verdicts totaling more than $250 million in damages, as opposed to six verdicts in favor of 3M. Before reaching this agreement, 3M attempted to place its earplug manufacturing subsidiary into bankruptcy to address the claims, but in June of 2023, an Indiana federal judge rejected this attempt, concluding that the proposed bankruptcy did not serve a valid purpose for reorganization.

Another large MDL in 2023 was the Phillips CPAP/BiPAP device litigation. This litigation transpired on the heels of a 2021 recall of Phillips’ continuous positive air pressure (CPAP) devices used to treat sleep apnea and bilevel positive airway pressure (BiPAP) devices used to treat certain breathing conditions. Phillips recalled the devices because of potential health risks from defective polyester-based polyurethane sound-reducing foam liners. The foam was found to degrade, allegedly releasing black particles and toxic chemicals into device air pathways that can cause negative health effects, including cancer and serious respiratory problems. Following the recall, patients filed personal injury lawsuits seeking compensation for their alleged injuries. In addition, class-action lawsuits were filed seeking economic damages for the cost of replacement devices and medical monitoring. These legal actions were consolidated into an MDL in the Western District of Pennsylvania.

In September 2023, Philips Respironics agreed to pay a minimum of $479 million to settle the CPAP class-action economic damages lawsuit. The personal injury lawsuits remain in litigation: as of February 2024, there were 760 pending cases in the MDL, with Bellwether trials expected to begin sometime this year. In addition, in January of this year, Philips announced it had reached a tentative agreement with the FDA to stop selling the devices. This is expected to cost Philips approximately $400 million in lost sales.

MDLs on the Horizon

In January 2024, the Judicial Panel on Multi-District Litigation (JPML) heard oral arguments on seven proposed MDLs. Two arguments were for the consolidation of pharmaceutical product liability lawsuits.

The first such pharmaceutical products liability matter concerned a drug called Suboxone (Buphrenorphone/Naloxone), used in the treatment of opioid dependency. The medication, which is dissolved in the mouth, allegedly causes dental problems, including tooth decay and loss. Following the hearing, the JPML ordered the centralization of fifteen cases in the Northern District of Ohio.

In the second pharmaceutical MDL hearing, the JPML considered for consolidation eighteen personal injury actions regarding Glucagon-Like Peptide-1 Receptor Agonists, which are medicines prescribed for treating type 2 diabetes. This class of medications includes Ozempic, Wegovy, and Rybelsus, which are manufactured by the Novo Nordisk defendants, and Trulicity and Mounjaro, which are manufactured by Eli Lilly and Company. These drugs have become increasingly popular for weight loss and allegedly cause gastrointestinal distress and gastroparesis (stomach paralysis). The JPML agreed to the formation of an MDL in the Eastern District of Pennsylvania. It now includes more than fifty cases.

Nuclear Verdicts

In a previous blog post, we discussed “nuclear verdicts” and their impact on the life science industry. Nuclear verdicts are defined as those where a jury has awarded over $10 million in damages. According to the Institute for Legal Reform, since 2019, 23.6% of nuclear verdicts nationally have come from product liability cases, slightly higher than auto cases (22.8%). Approximately 63% of nuclear verdicts over the past decade have been reported in just six states: California, reporting 211 nuclear verdicts with a median award of $21 million; Texas, reporting 132 nuclear awards also with a median award of $21 million; Pennsylvania, reporting 78 nuclear verdicts with more than half of these verdicts reached in the Philadelphia Court of Common Pleas; New York, reporting 151 nuclear verdicts with a median award of $19 million; Florida, reporting 213 nuclear verdicts with a median award of $20 million; and Illinois, reporting 75 nuclear verdicts with a median award of $20 million.

For more discussion of nuclear verdicts, see our recent blog post.

Be on the lookout for Part 2 of this series, focusing on defense decisions and key case law developments. Click here for the webinar, “Stay Ahead in Life Sciences: 2023 in Review and 2024 Trends.

Authored by Cindy Khin, Berkley Life Sciences, Life Sciences Casualty Resolution Director