The Federal Circuit Decides Future Lost Earnings Award Not Authorized in Vaccine Case in Which Child Died
Filed under: Bioethics, Children, Drugs & Medical Devices, Liability
The National Childhood Vaccine Act of 1986 requires parties seeking relief for vaccine-related injuries to proceed through a federal vaccination claims system. If a plaintiff prevails in her suit, she (or her estate) will receive damages for pain, suffering, and expenses. Significantly, other awards include death benefits or future earnings. On October 28, 2013, the Federal Circuit answered in the negative the question of “whether the estate of a petitioner who dies prior to judgment is entitled to compensation for lost future earnings.”
Tembenis v. Secretary of Health & Human Services arose out of the epilepsy four-month-old Elias Tembenis developed following vaccination for Diptheria–Tetanus–acellular–Pertussis. His parents filed a Petition for Vaccine Compensation but while the petition was still pending, Elias died of his disorder at age seven. In 2010, a special master determined the vaccine caused Elias’ epilepsy and death.
After the special master’s determination, Elias’ estate and the Secretary of Health and Human Services agreed on damages. The estate received a $250,000 death benefit, $175,000 for actual pain and suffering and past unreimbursable expenses, and $659,955.61 in future lost earnings. The Secretary reserved the right to challenge the future lost earnings award; the special master determined that Federal Circuit precedent suggested that the estate was entitled to lost earnings. The Secretary appealed to the Claims Court which upheld the special master’s ruling.
The Secretary then appealed to the Federal Circuit. The Circuit court analyzed 42 U.S.C. § 300aa–15(a)(3)(B):
In the case of any person who has sustained a vaccine-related injury before attaining the age of 18 and whose earning capacity is or has been impaired by reason of such person’s vaccine-related injury for which compensation is to be awarded and whose vaccine-related injury is of sufficient severity to permit reasonable anticipation that such person is likely to suffer impaired earning capacity at age 18 and beyond, compensation after attaining the age of 18 for loss of earnings determined on the basis of the average gross weekly earnings of workers in the private, non-farm sector, . . .
The Federal Circuit interpreted the language to determine the statute only allows for recovery of future lost earnings. The Court acknowledged the statute does not expressly require a claimant to be alive, but it also does not expressly state an estate can recover future lost earnings of a decedent.
The Court observed that the word “impaired” implies the victim must be living. When the claimant dies before 18, no reasonable expectation exists that she would be working after 18. Thus entitlement to a future lost earnings award is dependent upon the claimant being alive. Further, the Court stated, receiving both a death benefit and a future lost earnings award would be duplicative. The Court took pains to express sympathy to the family, noting that the death benefit of $250,000 was due to be increased as it had not been amended since the statute’s enactment in 1986. However, the amount of payment can only be changed by Congress and even if it does happen, it will be of no consolation or compensation to the Tembenis family.
What follows is a weekly feature here at Health Reform Watch. Each Monday morning, we provide a recap of the drug and device law and policy developments over the previous week that caught our eye and made us think. Credit for the format goes to Seton Hall Law alum Jordan T. Cohen, who used it to great effect in his series of Reform Rodeo posts.
1. Of great interest this past week were the continuing issues at Princeton University, where there has been an outbreak of a form of bacterial meningitis that is rare in this country and trustees were weighing whether to offer a vaccine that has been approved in Australia and Europe but not here in the United States.
2. In the New England Journal of Medicine, Janet Woodcock and colleagues from the FDA’s Center for Drug Evaluation and Research discuss the new “breakthrough therapy” designation and provide a helpful chart comparing it to the FDA’s other accelerated approval programs. Woodcock and colleagues conclude that “[a]s the pace of scientific discovery continues to increase, drug development pathways will need to evolve in parallel.”
3. At the FDA Law Blog, Dara Katcher Levy comments on a November 8, 2013 Warning Letter, in which the FDA’s Office of Prescription Drug Promotion “alleges that statements made by Aegerion Pharmacueticals’ CEO during broadcast interviews on a CNBC talk show, ‘Fast Money,’ constitute evidence of a new, unapproved, intended use for its drug, Juxtapid (lomitapide) capsules.” Ms. Levy explains that “[t]his is the first OPDP Warning Letter that takes issue with an initial broadcast of statements aimed at the financial community, rather than the re-distribution of these materials for purposes of product promotion or as part of a ‘media pitch’” and writes that she is “interested to see whether OPDP will be increasing its enforcement focus on investor-related materials and other materials intended for the financial community.”
3. At JAMA, Bridget Kuehn addresses the American Psychiatric Association’s contribution to the Choosing Wisely initiative, five recommendations for when physicians should avoid–and patients should question–prescribing an anti-psychotic medication. Kuehn quotes Robert Rosenheck: “The unanswered question is how to discourage inappropriate use of the drugs without impinging on physicians’ rights to prescribe them off label when they feel their use is warranted[.]“
5. Finally, Ed Silverman at Pharmalot reports on the European Medicines Agency’s decision to delay finalizing its new policy on disclosing patient-level clinical trial data. Silverman writes: “There was no indication that the draft policy will be changed, but the potential delay does suggest the possibility that the agency may consider modifying its language. If nothing else, the move underscores the volatility surrounding its plan and vehemence with which the larger issue of disclosing clinical trial data is regarded.”
In August of this year, a federal district court upheld a California ordinance requiring drug manufacturers who sell drugs in Alameda County to implement and fund a drug disposal program. This ordinance, which shifts the costs of drug disposal from local governments back to the originators of the drugs, is the first of its kind but if sustained it won’t be the last. In December 2012, PhRMA, the trade organization for drug manufacturers, challenged the ordinance on constitutional grounds, stating that it impermissibly interfered with interstate commerce. The District Court disagreed. Facing the possibility of incurring massive costs if such ordinances were implemented nationwide, PhRMA now appeals.
In response to growing concerns over the illegal resale of unused drugs and negative environmental impacts related to improper drug disposal, many communities and local governments have begun hosting so-called “take-back” programs. These programs provide consumers with a central repository for expired or otherwise unused prescription drugs and assume the responsibility for properly disposing of them. However the costs of implementing and sustaining these programs are substantial. According to PhRMA’s estimates, the start-up costs alone are $1.1 million. Additionally, operating costs could be as much as $1.2 million annually. Traditionally, local communities have assumed responsibility for funding these programs, but one county in California thinks otherwise.
Alameda County’s ordinance provides that manufacturers of drugs which are sold or distributed in Alameda County are responsible for operating “Product Stewardship Programs.” These programs must pay for the costs of “collecting, transporting and disposing of Unwanted Products collected from Residential Generators and the recycling or disposal, or both, of packaging collected with the Unwanted Product.” Additionally, the manufacturers are expected to pay administrative fees associated with enforcing the ordinance, which are estimated at $200,000 annually. The ordinance prohibits manufacturers from shifting any of these costs to the consumers.
PhRMA argued that the ordinance was a per se violation of the Commerce Clause because it discriminated against interstate commerce by shifting local costs to interstate manufacturers, who would presumably shift these costs to consumers nationwide. The District Court rejected the assertion that this was the type of discrimination which implicates the Commerce Clause. Because PhRMA failed to demonstrate, or even argue, that the ordinance favors in-state drug manufacturers over out-of-state manufacturers, the Court stated there was no per se violation of the Commerce Clause.
The Court went on to hold that the ordinance did not attempt to directly regulate interstate commerce because the ordinance applies only to activities which occur within Alameda County, i.e. the sale, distribution and disposal of drugs within that jurisdiction. Next, the Court held that the balancing test used for activities which have an indirect effect on interstate commerce was likewise unmet. Alameda County had shown a legitimate interest in regulating drug disposal for health and environmental reasons and PhRMA failed to show that its burden in funding the program outweighed those interests.
This is a case to watch. If this ordinance is upheld, similar ordinances will likely be enacted throughout the rest of California and potentially around the United States.
What follows is a weekly feature here at Health Reform Watch. Usually on Monday–but this week on Tuesday to make room for Jordan Paradise’s commentary on the FDA’s new approach to regulating trans fats–we provide a recap of the drug and device law and policy developments over the previous week that caught our eye and made us think. Credit for the format goes to Seton Hall Law alum Jordan T. Cohen, who used it to great effect in his series of Reform Rodeo posts.
1. Ed Silverman at Pharmalot reports on the FDA’s proposed rule allowing generic drug manufacturers to make safety-related changes to their products’ labels, a rule that would “mean that generic drugmakers could face the same sort of liability over product labeling as brand-name drugmakers.”
2. At Drug and Device Law, Steven Boranian comments on a recent decision in a line of cases in which a plaintiff who seeks to hold the manufacturer of an innovator drug liable for injuries caused by a different manufacturer’s generic copy: “Add another opinion to the “innovator liability” scorecard, and join us in foretelling that Conte will eventually collapse under the mountain of well-reasoned authority that is piling up against it.”
3. Writing at The Hill’s RegWatch blog, Julian Hattem quotes FDA Commissioner Margaret Hamburg on the pending pharmaceutical compounding legislation: “Believe me, it’s not that FDA is looking for a whole lot of new responsibilities, but when there is a health and safety problem like this where we think that we have the expertise and where clearly there should be national standards, we do believe that we should be given the authority that we need.”
4. In an essay in the New York Times entitled “Slow Dancing with Part D”, Jane Gross explains how a report from the Kaiser Family Foundation made her realize that her Medicare Part D plan “was an outlier … one of only two with premium increases in the 50 percent range.” Gross writes: “Does this mean I have to reconsider reconsidering? Be a responsible consumer? Just the prospect of vetting these plans year after year exhausts me. Open enrollment ends Dec. 7, which gives me a few days to kick the can down the road.”
5. Finally, Arthur Caplan and Nirav Shah argue in an opinion piece in JAMA that New York’s new requirement that “unvaccinated health care personnel in regulated settings to wear a surgical mask in areas where patients or residents may be present … is absolutely consistent with sound and ethical public policy.”
The Food and Drug Administration (FDA) has decisively entered the debate regarding the health risks of artificial trans fatty acids in foods. On November 8, the FDA announced its “tentative” determination that partially hydrogenated oils (PHOs), also known as trans fatty acids, are no longer generally recognized as safe for human consumption. The FDA cited research by the American Heart Association (AHA), the World Health Organization, the American Dietetic Association, the Institute of Medicine, and the FDA Food Advisory Committee Nutrition Subcommittee demonstrating that trans fats increase the risk of coronary heart disease. Trans fats simultaneously raise levels of bad cholesterol and lower good cholesterol, among other adverse negative health effects. In the FDA Press Release, Dr. Margaret Hamburg, Commissioner of the FDA, stated that reduction in trans fat intake “could prevent an additional 20,000 heart attacks and 7,000 deaths from heart disease each year – a critical step in the protection of Americans’ health.”
This is not the first move by the FDA to address the heavily documented health risks of trans fats. Ten years ago, the FDA implemented regulations that required information about the trans fatty acid content in foods and dietary supplements to be declared on the Nutrition Facts label. As a result, the label now identifies the total fat, saturated fat, and trans fat content. While not directly reducing or eliminating trans fats from American diets, the label requirement forced transparency on the part of food manufacturers and provided consumers with information on which to base purchasing decisions. It also incentivized manufacturers to scale down on the use trans fat in food production.
If the FDA determination is finalized, PHOs would no longer be permissible ingredients in food products without prior approval by the FDA as a safe food additive. Food additives, by statutory definition include substances that “result or may reasonably be expected to result, directly, or indirectly, in its becoming a component or otherwise affecting the characteristics of any food (including any substance intended for use in producing, manufacturing, packing, processing, preparing, treating, packaging, transporting, or holding food; and including any source of radiation intended for any such use).” The definition excludes several types of substances that are regulated under separate provisions, including pesticide chemicals, pesticide chemical residues, and color additives. All food additives that are not generally recognized by qualified scientific experts to be safe under the conditions of use are thus classified as not safe for market entry. Only after a generally recognized as safe (GRAS) determination by the FDA may a food additive enter the market as an ingredient in any given food product.
The FDA has a well-established regulatory process for determining whether a food additive is GRAS. The FDA maintains GRAS listings in the Code of Federal Regulations that act as a sort of recipe for food manufacturers. These complete listings are available here, here, and here. Generally, if a food additive conforms to that published GRAS listing, including the specific amount, intended use, good manufacturing practices, and any limitations, it may be used as an ingredient without prior FDA assessment. For example, caffeine is a GRAS listed substance for use in cola-type beverages. When added to other food products, however, caffeine is no longer considered GRAS and the FDA can institute an enforcement action against those products where there is a concern about public safety. This scenario played out several years ago with regard to drinks combining alcohol and caffeine.
The announcement is seen by those in the health and nutrition fields as an energizing sign of life in a recently limp FDA. Marion Nestle, a professor at New York University, proclaimed in an interview with the New York Times “[t]he FDA is back!” Likewise, organizations such as the AHA and the Center for Science in the Public Interest (CSPI) that have been advocating for increased regulation over trans fats praise the FDA’s move, though they emphasize that action is long overdue. CSPI originally petitioned the FDA for inclusion of trans fat information on the label in 1994 and subsequently in 2003 to prohibit use of PHO as a food ingredient.
It appears that the FDA anticipates phasing-in of the GRAS requirements, and has solicited the public for feedback on several aspects of scope and implementation. Specifically, the FDA asks for data supporting other approaches, input on the estimated timeframe to reformulate products to bring them into conformance, special considerations for small business, and any other foreseen challenges to such an approach. The comment period is open until January 7, 2014.