Consumers Sue Pharmaceutical Company Over Misleading Nexium Campaign
Thursday January 27, 2005
Consumer groups allege a scheme to deceive consumers and reap unfair profits from consumers.
Massachusetts Consumers Sue Pharmaceutical Company AstraZeneca Over Misleading Nexium Campaign
Consumer groups allege scheme to deceive consumers and reap unfair profits.
BOSTON, January 26, 2005 – Massachusetts consumers of the heartburn medication Nexium today filed a statewide class action lawsuit in Massachusetts Superior Court against the drug's distributor, AstraZeneca (NYSE: AZN). The suit alleges that the pharmaceutical company sought to preserve their market share and profits as the patent on their blockbuster drug, Prilosec®, was set to expire, by initiating a massive and misleading advertising and promotional campaign to deceive consumers into purchasing Nexium, a nearly identical new drug.
“The Nexium campaign is a perfect example of a ‘me-too' drug being falsely marketed as a medical improvement. Adding yellow stripes to the Purple Pill only improves AstraZeneca's bottom line, not consumers' health,” said Alex Sugerman-Brozan , Director of Community Catalyst's Prescription Access Litigation Project (PAL)
“AstraZeneca's Nexium promotional campaign has resulted in billions of dollars of unnecessary drug expenditures at a time when rising drug prices have created a health care crisis in this country. As a result, hundreds of thousands of patients take Nexium when they don't need to or when more affordable substitutes are readily available,” said John McDonough , Director of Health Care For All, which is a plaintiff in the lawsuit.
“As part of its strategy to switch patients from Prilosec to nearly identical Nexium, most of AZ's clinical studies compared 40mg of Nexium to 20 mg of Prilosec. In addition, according to a 2002 article in the Wall Street Journal , AZ ‘won't release detailed descriptions' of two studies that showed even the higher dose of Nexium to be no more effective than Prilosec,” explained John Abramson, M.D., author of Overdosed America: The Broken Promise of American Medicine. “Evidence-based medical care is not necessarily the best care when the scientific evidence is designed to optimize commercial benefit instead of health. In the case of Nexium, doctors and patients have been misled into believing that Nexium, which costs up to 7 times as much, is superior to over-the-counter Prilosec.”
Prilosec (also known as Losec) is a proton-pump inhibitor (PPI) primarily used to treat Gastroesophageal Reflux Disease (GERD) and was AstraZeneca's most profitable drug. By 2000, Prilosec was the most prescribed drug in the world, with annual global sales reaching $6 billion. But with Prilosec's patent set to expire in 2001, its loss of brand name protection and assured competition from generic drug manufacturers posed a financial vulnerability to the pharmaceutical company.
The lawsuit alleges that AstraZeneca responded to this financial threat by launching a massive advertising campaign to overshadow the perceived effectiveness of Prilosec, and persuade consumers that Nexium was a new and improved PPI.
“As a consumer, I'm outraged that a company supposedly in the business of helping people would put its profits ahead of my health and well-being,” said Glenn Crenshaw, who took Nexium and who is a plaintiff in the lawsuit. “Tricking consumers into switching to a drug that's much more expensive has caused millions of people fiscal heartburn and shows that the system is in real need of change.”
“We feel that AstraZeneca is misleading the public through expensive marketing campaigns that don't tell the whole story about Nexium and Prilosec, in order to increase its sales,” said Bob Master, Director of Commonwealth Care Alliance. “Schemes like this add to the runaway cost of health care and every dollar spent unnecessarily on expensive new drugs of dubious added value is a dollar less available for real patient care.”
The suit is brought by Health Care For All, Commonwealth Care Alliance, and individual consumers, on behalf of Massachusetts residents who purchased Nexium. Both organizations are members of the Prescription Access Litigation Project (PAL), a national coalition of over 100 consumer organizations dedicated to fighting illegal pharmaceutical price inflation through class-action lawsuits.
The lawsuit claims that AstraZeneca is violating the Massachusetts Consumer Protection Act, Chapter 93A. That law prohibits “unfair methods of competition and unfair or deceptive acts or practices” by businesses. The lawsuit alleges that by deceiving the public about the value and effectiveness of Nexium through a multi-million advertising campaign, AstraZeneca has illegally deceived Massachusetts consumers and caused them to pay a premium price for Nexium as a result of that advertising.
About Prescription Access Litigation Project
Prescription Access Litigation Project (PAL) (www.prescriptionaccess.org ) is a project of Boston-based Community Catalyst. PAL is a nationwide coalition of over 100 state, local, and national senior, labor and consumer health advocacy groups in 35 states fighting to make prescription drugs affordable. Since its launch in 2001, PAL has filed 20 sets of lawsuits targeting drug industry practices that illegally push the price of prescription drugs beyond the reach of the American consumer.
About Community Catalyst
Community Catalyst ( www.communitycatalyst.org ) is a Boston-based national advocacy organization that builds consumer and community participation in the shaping of our health system to ensure quality, affordable health care for all.
About Health Care For All
Health Care For All ( www.hcfama.org ) is an consumer advocacy organization building a movement of empowered people and organizations with the goal of creating a health care system that is responsive to the needs of all people, particularly the most vulnerable. Health Care For All is dedicated to making quality health care a right of all people.
About the Commonwealth Care Alliance
Commonwealth Care Alliance, Inc. (CCA) is a newly incorporated, not-for-profit care delivery system committed to the provision of integrated health care and related social support services. CCA has been created as a “consumer–governed” organization offering a full spectrum of medical and social services for people with complex needs covered under Medicaid and for those (“dually eligible”) covered by both Medicaid and Medicare, including: older adults (65+), individuals with serious physical, cognitive, or chronic mental illness, and children with special needs.
About Hagens Berman
Hagens Berman is a law firm with offices in Seattle, Boston, Los Angeles, and Phoenix. The firm has developed a nationally recognized practice in class action litigation. The firm is co-lead counsel in litigation to recover losses from Enron employees' retirement funds and represented Washington and 12 other states in lawsuits against the tobacco industry that resulted in the largest settlement in the history of litigation. The firm also served as counsel in several other high-profile cases including the Washington Public Power Supply litigation, which resulted in a settlement of more than $850 million, and the $92.5 million settlement of The Boeing Company litigation. Other notable cases include litigation involving the Exxon Valdez oil spill; Louisiana Pacific Siding; Morrison Knudsen; Piper Jaffrey; Nordstrom; Boston Chicken; and Noah's Bagels.
(Gardiner Harris, “AstraZeneca Fends Off Generics for Prilosec; New Heartburn Drug Nexium Is Introduced,” Wall Street Journal June 6, 2002)
Contact:
Michael Gipstein
Community Catalyst
617-275-2805
gipstein@communitycatalyst.org
Heidi Vincent
Health Care for All
617-275-2915
Vincent@hcfama.org
Massachusetts Consumers Sue Pharmaceutical Company AstraZeneca Over Misleading Nexium Campaign
Consumer groups allege scheme to deceive consumers and reap unfair profits.
BOSTON, January 26, 2005 – Massachusetts consumers of the heartburn medication Nexium today filed a statewide class action lawsuit in Massachusetts Superior Court against the drug's distributor, AstraZeneca (NYSE: AZN). The suit alleges that the pharmaceutical company sought to preserve their market share and profits as the patent on their blockbuster drug, Prilosec®, was set to expire, by initiating a massive and misleading advertising and promotional campaign to deceive consumers into purchasing Nexium, a nearly identical new drug.
“The Nexium campaign is a perfect example of a ‘me-too' drug being falsely marketed as a medical improvement. Adding yellow stripes to the Purple Pill only improves AstraZeneca's bottom line, not consumers' health,” said Alex Sugerman-Brozan , Director of Community Catalyst's Prescription Access Litigation Project (PAL)
“AstraZeneca's Nexium promotional campaign has resulted in billions of dollars of unnecessary drug expenditures at a time when rising drug prices have created a health care crisis in this country. As a result, hundreds of thousands of patients take Nexium when they don't need to or when more affordable substitutes are readily available,” said John McDonough , Director of Health Care For All, which is a plaintiff in the lawsuit.
“As part of its strategy to switch patients from Prilosec to nearly identical Nexium, most of AZ's clinical studies compared 40mg of Nexium to 20 mg of Prilosec. In addition, according to a 2002 article in the Wall Street Journal , AZ ‘won't release detailed descriptions' of two studies that showed even the higher dose of Nexium to be no more effective than Prilosec,” explained John Abramson, M.D., author of Overdosed America: The Broken Promise of American Medicine. “Evidence-based medical care is not necessarily the best care when the scientific evidence is designed to optimize commercial benefit instead of health. In the case of Nexium, doctors and patients have been misled into believing that Nexium, which costs up to 7 times as much, is superior to over-the-counter Prilosec.”
Prilosec (also known as Losec) is a proton-pump inhibitor (PPI) primarily used to treat Gastroesophageal Reflux Disease (GERD) and was AstraZeneca's most profitable drug. By 2000, Prilosec was the most prescribed drug in the world, with annual global sales reaching $6 billion. But with Prilosec's patent set to expire in 2001, its loss of brand name protection and assured competition from generic drug manufacturers posed a financial vulnerability to the pharmaceutical company.
The lawsuit alleges that AstraZeneca responded to this financial threat by launching a massive advertising campaign to overshadow the perceived effectiveness of Prilosec, and persuade consumers that Nexium was a new and improved PPI.
“As a consumer, I'm outraged that a company supposedly in the business of helping people would put its profits ahead of my health and well-being,” said Glenn Crenshaw, who took Nexium and who is a plaintiff in the lawsuit. “Tricking consumers into switching to a drug that's much more expensive has caused millions of people fiscal heartburn and shows that the system is in real need of change.”
“We feel that AstraZeneca is misleading the public through expensive marketing campaigns that don't tell the whole story about Nexium and Prilosec, in order to increase its sales,” said Bob Master, Director of Commonwealth Care Alliance. “Schemes like this add to the runaway cost of health care and every dollar spent unnecessarily on expensive new drugs of dubious added value is a dollar less available for real patient care.”
The suit is brought by Health Care For All, Commonwealth Care Alliance, and individual consumers, on behalf of Massachusetts residents who purchased Nexium. Both organizations are members of the Prescription Access Litigation Project (PAL), a national coalition of over 100 consumer organizations dedicated to fighting illegal pharmaceutical price inflation through class-action lawsuits.
The lawsuit claims that AstraZeneca is violating the Massachusetts Consumer Protection Act, Chapter 93A. That law prohibits “unfair methods of competition and unfair or deceptive acts or practices” by businesses. The lawsuit alleges that by deceiving the public about the value and effectiveness of Nexium through a multi-million advertising campaign, AstraZeneca has illegally deceived Massachusetts consumers and caused them to pay a premium price for Nexium as a result of that advertising.
About Prescription Access Litigation Project
Prescription Access Litigation Project (PAL) (www.prescriptionaccess.org ) is a project of Boston-based Community Catalyst. PAL is a nationwide coalition of over 100 state, local, and national senior, labor and consumer health advocacy groups in 35 states fighting to make prescription drugs affordable. Since its launch in 2001, PAL has filed 20 sets of lawsuits targeting drug industry practices that illegally push the price of prescription drugs beyond the reach of the American consumer.
About Community Catalyst
Community Catalyst ( www.communitycatalyst.org ) is a Boston-based national advocacy organization that builds consumer and community participation in the shaping of our health system to ensure quality, affordable health care for all.
About Health Care For All
Health Care For All ( www.hcfama.org ) is an consumer advocacy organization building a movement of empowered people and organizations with the goal of creating a health care system that is responsive to the needs of all people, particularly the most vulnerable. Health Care For All is dedicated to making quality health care a right of all people.
About the Commonwealth Care Alliance
Commonwealth Care Alliance, Inc. (CCA) is a newly incorporated, not-for-profit care delivery system committed to the provision of integrated health care and related social support services. CCA has been created as a “consumer–governed” organization offering a full spectrum of medical and social services for people with complex needs covered under Medicaid and for those (“dually eligible”) covered by both Medicaid and Medicare, including: older adults (65+), individuals with serious physical, cognitive, or chronic mental illness, and children with special needs.
About Hagens Berman
Hagens Berman is a law firm with offices in Seattle, Boston, Los Angeles, and Phoenix. The firm has developed a nationally recognized practice in class action litigation. The firm is co-lead counsel in litigation to recover losses from Enron employees' retirement funds and represented Washington and 12 other states in lawsuits against the tobacco industry that resulted in the largest settlement in the history of litigation. The firm also served as counsel in several other high-profile cases including the Washington Public Power Supply litigation, which resulted in a settlement of more than $850 million, and the $92.5 million settlement of The Boeing Company litigation. Other notable cases include litigation involving the Exxon Valdez oil spill; Louisiana Pacific Siding; Morrison Knudsen; Piper Jaffrey; Nordstrom; Boston Chicken; and Noah's Bagels.
(Gardiner Harris, “AstraZeneca Fends Off Generics for Prilosec; New Heartburn Drug Nexium Is Introduced,” Wall Street Journal June 6, 2002)
Contact:
Michael Gipstein
Community Catalyst
617-275-2805
gipstein@communitycatalyst.org
Heidi Vincent
Health Care for All
617-275-2915
Vincent@hcfama.org
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