By Jennifer Thompson in Tokyo and Andrew Ward in London
Takeda and Eli Lilly have been ordered to pay $9bn in punitive damages for hiding a possible link between a best-selling diabetes drug and bladder cancer – the biggest fine imposed in the pharmaceutical sector.
A jury in Louisiana imposed the record penalty on Japan’s biggest drugmaker and its former US partner in the first federal trial over the controversial Actos medicine.
The ruling adds to a history of big penalties against pharmaceutical companies for concealing the health risks of new drugs and promises to increase pressure on the industry to open clinical trial data to greater transparency.
Takeda and Eli Lilly have been besieged by thousands of lawsuits from patients since the US Food and Drug Administration warned in 2011 that use of Actos for more than a year might increase the risk of bladder cancer.
Both companies said they intended to “vigorously challenge” the Louisiana verdict.
Takeda, which developed Actos, was ordered to pay $6bn, and Eli Lilly, which marketed the drug until 2006, was ordered to pay $3bn. However, the US company said it was indemnified by Takeda for losses, implying that the Japanese company would foot the entire bill. Takeda’s share price slumped by 7.6 per cent in Tokyo, marking its worst one-day slide for five years.
Analysts said it was likely that the damages would be sharply reduced by a judge – and could be overturned on appeal. But the first victory in a federal court is sure to offer encouragement to other plaintiffs lining up to sue Takeda.
Actos was once Takeda’s best-selling medicine, generating more than $16bn of sales since its 1999 launch, but has recently been in sharp decline because of generic competition and fears over its alleged link with bladder cancer.
Drug companies have been scrambling to develop new diabetes treatments in response to a rising epidemic of the disease across the world.
In addition to the punitive damages, the Louisiana jury awarded $1.5m in compensation to Terrence Allen, the plaintiff who blamed his bladder cancer on Actos.
Takeda said it disagreed with the verdict and remained confident in the benefits of Actos and “its importance as a treatment for type two diabetes”.