A new concern for drug-makers emerges: “Pipeline Liability”


drugs; medicine; medication; pills

By: Nathaniel L. Dunn

California Court of Appeal decision finds pharmaceutical companies owe their customers a duty to move safer alternatives to existing drugs through the development pipeline.  

In the 1980s, an HIV/AIDS diagnosis was widely seen as a death sentence. That perception changed over the decades which followed, and HIV is now considered a treatable condition. While we still do not have a cure for the HIV virus which causes AIDS, anti-retroviral drugs are a critical tool in extending the lives of millions of people around the globe who have received an HIV diagnosis.  

Despite the positive public perception of anti-retroviral drugs generally, risks associated with their use do exist. The plaintiffs in the consolidated matter of the Gilead Tenofovir Cases, which is pending before the San Francisco County Superior Court (Case No. CJC19005043), allege pharmaceutical giant Gilead’s anti-retroviral drug tenofovir disoproxil fumarate (TDF) caused them to suffer various adverse effects. 

While litigation against drug-makers related to health problems caused by their medications is nothing new, the plaintiffs in the Gilead Tenofovir Cases recently survived summary judgment on what many would consider a novel theory of liability: Gilead’s alleged delay in bringing a new product to market which was a safer alternative to its existing drug, even without proof the existing drug was defective.  

In a recent decision handed down by California’s First District Court of Appeal, Gilead Life Sciences, Inc. v. Superior Court (Case No. A165558), the appellate court affirmed the trial court’s denial of Gilead’s motion for summary judgment with respect to the plaintiffs’ negligence claim, which argued Gilead owed the plaintiffs a duty to advance a successor to TDF, Tenofovir alafenamide fumarate (TAF), through its development pipeline once it appeared TAF might be a safer alternative to TDF with fewer adverse effects.  

The plaintiffs allege Gilead’s duty of reasonable care extends not only the duty to ensure its products are free of defects, but to Gilead’s decisions regarding which products to move through their development pipeline. The plaintiffs contend Gilead breached that duty by deferring development of TAF, a potentially safer alternative, while TDF remained profitable. 

Gilead moved for summary judgment as to plaintiffs’ negligence cause of action on the basis that plaintiffs’ theory of liability attempted to create a new duty on the part of drug manufacturers where none should exist. Gilead’s position was that in the absence of evidence TDF was a defective product, it could not be held liable for TDF remaining on the market while TAF was still in the development process.  

Both the trial court and the Court of Appeal agreed with the plaintiffs’ position that a drug manufacturer’s duty of reasonable care includes not only the duty to ensure its products are free of defects, but extends to their decisions regarding products still in development.  

The First District Court of Appeal’s decision in Gilead Life Sciences, Inc. v. Superior Court has the potential to send shockwaves through the pharmaceutical industry if its holding becomes widely adopted by other courts. Drug-makers could soon face liability not only for adverse effects caused by their existing products, but for the decisions they make regarding when to bring the next generation of treatments to market.  

Read the full text of the opinion here:  

Nathaniel L. Dunn is a Senior Counsel in Freeman Mathis & Gary’s Walnut Creek office.