PEARL O NEILL v. NOVARTIS CONSUMER HEALTH, INC.,

Filed 2/27/07

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FOUR

STORY CONTINUED FROM PART I..

III

Appellants claim the trial court erroneously allowed Novartis to present massive FDA evidence while limiting appellants FDA evidence and restricting their use of that evidence to cross-examination and rebuttal.

It is apparent from the record that both sides in this litigation recognized the relevance of evidence of the FDAs review of PPA products; they both sought introduction of FDA evidence favorable to their position, and sought to exclude FDA evidence that could be harmful. For example, appellants objected to Novartiss use of FDA evidence to show that the FDA allowed products containing PPA to be legally marketed and did not order them removed from the market until long after appellants suffered their strokes. But appellants relied on the fact that the FDA deferred action on categorizing PPA cough and cold products as safe and effective, pending the results of the Yale Study. They relied heavily on the results of that study, and on the FDAs action in asking the manufacturers to withdraw PPA products from the market in light of the Yale Study.

The record demonstrates that the trial court carefully considered admission of each piece of FDA evidence, whether proffered by appellants or Novartis. There is no indication that, as appellants claim, the court gave Novartis unfettered discretion about what FDA evidence to introduce and argue.

Nor do we find that appellants faced unfair limitations on their ability to present FDA-related evidence. They were precluded from obtaining the testimony of any officer or employee of the FDA by 21 Code of Federal Regulations part 20.1(a) (2006), which provides: No officer or employee of the Food and Drug Administration . . . shall give any testimony before any tribunal pertaining to any function of the Food and Drug Administration or with respect to any information acquired in the discharge of his official duties. Novartis also was limited by this regulation. As the court instructed the jury, the regulation doesnt count against either side, thats just your federal government and a rule that happens to be in effect.

Appellants do not actually claim they were prevented from introducing FDA evidence at all; they argue that the court refused to allow them to refer to that evidence during opening statement or in their case-in-chief. We find no unreasonable restriction.

In opening, appellants counsel argued: The FDA evidence youll hear is this, that this product was what they called grandfathered by the FDA. It was on the market in the early 1900s, and it stayed on the marketPPA stayed on the market and was grandfathered in. In other words, they got a free pass as to safety, and youll hear evidence that the FDA never tested PPA. Counsel proceeded to give a timeline, explaining the FDA never found PPA was safe. Thats the evidence in this case. And all they did. They kept deferring ruling, and youre going to hear why they deferred ruling. Youre going to also hear evidence that that over-the-counter division was overworked according to the documents from Novartis, the defendants documents, that they were overworked and understaffed, inexperienced, that division. But, remember, the FDA is not on trial here. Under California law Novartis is the one that has the responsibility and the duty to provide safety of the drug that theythat they make, that they label, that they market, sell and profit from. The FDA does none of those things so under our law we believe Novartis is liable.

Counsel then described the history of PPAs monograph study, including the increasing concerns of the FDA and its deferral of action. Counsel argued that political pressure was placed on the FDA to back off from labeling PPA as unsafe. Counsel described the mounting evidence of injury from PPA and the FDAs delay in acting on it pending results of the Yale Study. Counsel argued that instead of accepting the study and taking the drug off the market, Novartis hired experts to attack the Yale results. Youre going to see them do that in this courtroom, try and undercut the Yale results, but youre going to hear from the Yale people saying, No, this is a good study; the FDA says its a good study, and they pressured Yale not to release the preliminary data to the FDA. According to counsel, after a seven-month delay, the Yale Study was given to the FDA. The FDA committee concluded that the study showed an association between PPA use and increased risk of hemorrhagic stroke, and issued a withdrawal of approval.

Another of appellants attorneys described the FDAs role in greater detail. He explained that FDA regulations are only minimum standards. He reviewed the history of PPA and the FDAs monograph process for older drugs such as PPA. Counsel displayed a chronology prepared by an FDA staff member, and explained that the FDA produced only some documents, withholding others under claim of privilege. He stated that a statute prohibits both sides from taking the depositions of FDA staff members; I wish we could have testimony from those folks as to what was going on. We have to get by on the documents that we do have. At this point, the court informed the jury that the restriction on FDA testimony is a federal rule that doesnt work for or against anybody in this case. Thats a fact we have to live with.

Counsel proceeded to review the chronology of PPA review set out in the FDA document, and then presented [t]he bottom lineConsumers could buy P.P.A. even though the F.D.A. never found it to be safe, because of the marketing loophole and F.D.A. regulations and Pearl ONeill and Linda Lutz and other consumers around the country never knew that P.P.A. had never been officially found safe by the F.D.A. These excerpts demonstrate that appellants faced no unreasonable restriction in addressing FDA evidence during their opening.

Appellants also presented detailed evidence about the workings of the FDA in their case-in-chief. This included the deposition testimony of James Parker, a doctor of pharmaceutical chemistry who worked for many years in the regulatory affairs department of a pharmaceutical company. In the course of his work, Dr. Parker became familiar with the FDAs practices and procedures, and later taught Food and Drug Law at Boston College School of Law. He had been a consultant in the area of FDA law and regulation for pharmaceutical products since 1990. Dr. Parker testified about the history and purpose of the FDA. He described the agencys monograph process for examining the safety and effectiveness of over-the-counter pharmaceuticals which already were on the market, and described the process of approval of new drug applications. He also testified about the FDAs labeling regulations and explained the different standards for warnings on prescription and nonprescription drugs. After giving this background on the FDA procedures, Dr. Parker testified more specifically about the monograph review history of PPA. He gave extensive testimony about the FDAs consideration and conclusions with regard to PPA.

Appellants presented the deposition testimony of Dr. Jerry Avorn, a physician, associate professor of medicine, and chief of the division of pharmacoepidemiology and pharmacoeconomics at one of the main teaching hospitals at Harvard Medical School. Dr. Avorn testified about the purpose and protocol of the Yale Study, and explained the content of the final report. He then testified about the FDAs response to the Yale Study.

Through counsels opening statements, through their own witnesses, and through cross-examination of Novartiss witnesses, appellants had a full opportunity to present FDA evidence to support their case and to rebut Novartiss efforts to utilize FDA evidence as a defense. We find no unreasonable restriction in appellants ability to present their evidence.

IV

Appellants claim the court improperly excluded six specific items of evidence. The first is a document labeled Project Team Meeting Minutes. This exhibit contained the combined minutes of two Project Team Meetings and were signed by Gregory M. Torre, Director, Drug Registration & Regulatory Affairs for Sandoz, one of Novartiss predecessors. (See fn. 1, ante.) The minutes were prepared on May 15, 1990, and reported the meetings of January 29, 1990 and March 20, 1990.

Novartis did not challenge the authenticity of these minutes (which came from its own files), but argued that the document did not satisfy Evidence Code section 1271, the business records exception to the hearsay rule, because it was not prepared at or near the time of the meetings. The court agreed.

Appellants then argued that the evidence was admissible as a party admission, based on the portion of the minutes discussing the FDA monograph status of PPA. The pertinent paragraph states: Tavist D. was originally approved with the safety and efficacy of its PPA component having been assumed by PPAs consideration in the Cough/Cold OTC Products-Oral Nasal DecongestantTentative Final Monograph. At the time of the TFM the safety of PPA was called into question and it was proposed by the FDA that the issue would be definitively addressed by the time a Final Monograph was issued. To date, the Monograph has not been finalized. The safety of PPA remains in Regulatory limbo.

Appellants explained that Novartis consistently had taken the position that when Tavist-D was first approved by the FDA, the FDA passed on the safety of PPA. They argued that the minutes constituted an admission by Novartis, through its employee, that the FDAs approval of Tavist-D was not a determination that PPA was safe.

Evidence Code section 1222 sets out the hearsay exception for an authorized admission: Evidence of a statement offered against a party is not made inadmissible by the hearsay rule if: [] (a) The statement was made by a person authorized by the party to make a statement or statements for him concerning the subject matter of the statement; and [] (b) The evidence is offered either after admission of evidence sufficient to sustain a finding of such authority or, in the courts discretion as to the order of proof, subject to the admission of such evidence. For purposes of this exception, the authority of a declarant employee to make a statement for an employer can be implied as well as express. (OMary v. Mitsubishi Electronics America, Inc. (1997) 59 Cal.App.4th 563, 570.) The determination generally requires an examination of the nature of the employees usual and customary authority, the nature of the statement in relation to that authority, and the particular relevance or purpose of the statement. (Ibid.)

Appellants presented no evidence of Dr. Torres authority to make a statement on behalf of the company. They relied on his title, Director of Regulatory Affairs. Although place in an employers hierarchy is important in determining authority to speak, Dr. Torres title, without more, is not sufficient to show he had authority to make admissions on behalf of a company. (See OMary v. Mitsubishi Electronics America, Inc., supra, 59 Cal.App.4th at p. 572 [mere fact declarant was a vice-president does not automatically confer authority to make admissions on behalf of company].) In the absence of the necessary foundation for an authorized admission, the court properly excluded this evidence.

Appellants next claim error in the courts exclusion of testimony of two experts from an unrelated case involving Parlodel, a medication manufactured by Novartis.^[1] Parlodel was associated with strokes and intracerebral hemorrhages in post-partum women, resulting in lawsuits against Novartis. Novartis moved in limine to exclude testimony by two of its experts in a Parlodel lawsuit, Soldo v. Sandoz Pharmaceuticals Corp., filed in the United States District Court for the Western District of Pennsylvania.

According to appellants, Dr. Stanley Cohan and Dr. Sheila Buchbinder testified in depositions in the Soldo case that PPA can cause strokes, and gave their expert opinion that PPA was a cause of stroke in a young woman who was taking both Parlodel and a product containing PPA.

Evidence Code section 1292 governs the admissibility of former testimony given in another case, and provides: (a) Evidence of former testimony is not made inadmissible by the hearsay rule if: [] (1) The declarant is unavailable as a witness; [] (2) The former testimony is offered in a civil action; and ] (3) The issue is such that the party to the action or proceeding in which the former testimony was given had the right and opportunity to cross-examine the declarant with an interest and motive similar to that which the party against whom the testimony is offered has at the hearing.

Appellants did not show that the experts were unavailable as witnesses. Nor was there a showing that Novartis had a similar interest and motive in examining the experts in the Soldo case and in this one. [S]imilarity of interest and motive must be determined on practical considerations, not merely the similar position of the parties in the two cases. (Gatton v. A.P. Green Services, Inc. (1998) 64 Cal.App.4th 688, 692.) In Soldo, Novartis was interested in pointing to causes of stroke other than the plaintiffs ingestion of Parlodel; expert testimony implicating PPA as a possible cause of the stroke would thus have been helpful in the Soldo case, but potentially harmful in this one. The evidence did not meet the requirements for the former testimony exception to the hearsay rule.

Appellants also argued the evidence was admissible as an authorized admission, under Evidence Code section 1222. They presented no evidence that the experts were authorized agents of Novartis on the subject of PPA causing strokes. The fact that they were retained by Novartis in the Soldo case does not automatically establish the necessary agency relationship. As the court explained in Kirk v. Raymark Industries, Inc. (3d Cir. 1995) 61 F.3d 147, 164, In theory, despite the fact that one party retained and paid for the services of an expert witness, expert witnesses are supposed to testify impartially in the sphere of their expertise. . . . Since an expert witness is not subject to the control of the party opponent with respect to consultation and testimony he or she is hired to give, the expert witness cannot be deemed an agent.

The court excluded this evidence under Evidence Code section 352, as more prejudicial than probative. Appellants wanted the evidence admitted to show that Novartis had notice of PPAs tendency to cause strokes, and acted with conscious disregard by ignoring that information. The expert testimony in the Soldo case was given after the time of appellants strokes, so its probative value on notice was very limited. The court found the evidence was likely to confuse the jury, and would lead us down through a lot of collateral issues. To the extent the experts relied on studies that preceded appellants strokes, the underlying studies were admitted, so the prior testimony would have been cumulative. For all these reasons, we find no abuse of discretion in the courts exclusion of this evidence.

Next, appellants claim the court should have taken judicial notice of the denial of summary judgment in Glaser v. Thompson Medical Co., Inc. (6th Cir. 1994) 32 F.3d 969. This decision, they argue, provided compelling evidence that there was sufficient scientific evidence of ponderable significance to justify requiring stroke warnings on PPA products before these plaintiffs strokes and/or that the products should have been reformulated with PSE. Court records may be the subject of judicial notice under Evidence Code section 452, subdivision (d), but that is not what appellants were seeking. They wanted judicial notice of the Glaser decision, for purposes of relying on the courts factual determination. A court may take judicial notice of a courts action, but may not use it to prove the truth of the facts found and recited. (Kilroy v. State of California (2004) 119 Cal.App.4th 140, 145; see also Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1564-1569.) The court properly refused to take judicial notice of the Glaser decision.

Appellants claim the court erred in excluding the testimony of Dr. Avorn that pulling PPA from the market was politically impossible. They fail to present legal argument to support this claim. Whether or not the evidence was properly excluded, appellants suffered no prejudice. They were permitted to introduce other evidence to make this same point, including letters from New York Senator Alfonse DAmato to the Secretary of Health and Human Services. In 1981, writing on behalf of a New York vendor of weight control drugs, Senator DAmato expressed concern that the FDA was planning to release a 1979 report on the safety and effectiveness of PPA which would prejudice the use of PPA or otherwise negate positive conclusions which were contained in the 1979 study. He specifically requested that before the FDA takes any action with respect to the report that you insure the weight control industrys point of view is given the full consideration it deserves. In a 1984 letter to the Secretary of the Department of Health and Human Services, Senator DAmato expressed concern that the FDA was proposing reclassification of PPA from category 1 status, safe and effective, to category 3. This proposed downgrading is based on questionable scientific evidence of foreign origin and if approved would have a devastating impact on a number of my constituents in terms of lost jobs. Appellants had the opportunity to show, and to argue, that political pressure delayed the FDAs action on the classification of PPA.

Appellants claim the court improperly refused to admit evidence of the FDA analysis on additional adverse event reports. As Novartis points out, the September 27, 2000 memorandum was admitted into evidence.

Finally, appellants claim the court erred in excluding evidence that Novartis did not report adverse events to the FDA. They give us no indication of the basis for the courts ruling, and present no legal argument with regard to that ruling. We deem the issue abandoned.

In this lengthy and complex trial, the trial court carefully and properly exercised its discretion in the admission and exclusion of evidence.

DISPOSITION

The judgment is affirmed. Respondent is to have its costs on appeal.

CERTIFIED FOR PUBLICATION.

EPSTEIN, P. J.

We concur:

WILLHITE, J.

MANELLA, J.

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^[1] The suit was against Novartis Pharmaceuticals, a sister corporation to Novartis Consumer Health, the primary defendant in this case.