Court Rules on Dueling Drug Company Experts

In a pharmaceutical company’s Lanham Act suit alleging defendant pharmaceuti­cal company cut into plaintiff’s profits by listing in industry databases a proposed generic equivalent to plaintiff’s Donna­tal drug for irritable bowel syndrome, a Charlottesville U.S. District Court ex­cludes testimony from one of plaintiff’s experts that plaintiff suffered $29 million in lost profits, but will allow expert tes­timony from another plaintiff’s expert on the effect of industry database listings on provider behavior and from a defense ex­pert on drug price increases, therapeutic class review and brand loyalty.

Plaintiff’s expert

Plaintiff Concordia Pharmaceuticals retained Dr. Brian Reisetter to offer opin­ions on the market impact and industry consequences of Method’s submissions to Medi-Span and First Databank data­bases. Reisetter is a licensed pharmacist with a doctorate in pharmacy administra­tion, who also works as consultant for the pharmaceutical and medical industries. He has performed extensive research concerning the effects of pharmaceutical databases listings on the perceptions and behavior of pharmacists and doctors. In the instant action, Reisetter has offered the opinion that Method’s efforts to list its Me-PB-Hyos products with Medi-Span and First Databank “caused the market­place to believe that there was an actual ‘generic’ or pharmaceutical equivalent for Donnatal appropriate for substitution,” and that this set off a series of inevitable downstream events in the marketplace that adversely affected the number of prescriptions for Donnatal filled and units sold, despite no such product being avail­able.

To the extent Method faults Reisetter for not considering certain discrete “avail­ability issues” that it identified during discovery, such as emails indicating that some pharmacies had incorrect or outdat­ed National Drug Code (NDC) numbers for Donnatal products, there is no indica­tion that these issues were raised during Reisetter’s deposition or considered by Method’s own experts in rendering their opinions. While the availability issues identified by Method could arguably af­fect the weight accorded to Reisetter’s testimony, the court is unable to conclude that they render his testimony inadmis­sible. The court also declines to preclude Reisetter from using Prozac to illustrate how generic substitution commonly oc­curs in the pharmaceutical industry. The distinctions Method points out go to the weight of the testimony regarding generic substitution rather than its admissibility.

Finally, the fact that Reisetter based his opinions, at least in part, on surveys performed in connection with other cases or research projects does not justify ex­cluding Reisetter’s testimony. Defendants are free to point out that his opinions are not based on quantitative or qualitative research employed to determine actual market behavior in response to the par­ticular database listings at issue in this case.

Defense expert

Defendant Method Pharmaceuticals re­tained Dr. William Fassett to review the reports from plaintiff Concordia’s experts and to offer his own opinions regarding market conditions applicable to the sale of Donnatal product and the effect of the database listings for Method’s Me-PB-Hy­os products. Fassett has been a licensed pharmacist for over 45 years and is a pro­fessor emeritus for pharmacotherapy at Washington State University. He also sits on the editorial board of several peer-re­viewed publications related to pharmacy and the pharmaceutical industry and has authorized peer-reviewed publications relating to drug use review, product se­lection and computer applications in the pharmaceutical industry.

Concordia seeks to exclude three opin­ions expressed in Fassett’s expert report. The first opinion pertains to drug price increases; the second opinion indicated that a therapeutic class review may have affected the formulary status of Donnatal; and the third opinion was that Fassett would not expect a significant degree of loyalty to Donnatal among prescribers or pharmacists. The court is persuaded that these three opinions are based on mere speculation.

It is clear from the record that Fassett’s opinions are derived from his decades of experience as a pharmacist, during which he dispensed Donnatal and its gener­ic competitors; his extensive experience working with formulary committees; and his specialized knowledge of how formu­lary committees make coverage determi­nations. The fact that these opinions are based in large measure on Fassett’s per­sonal experience does not preclude him from offering the opinions.

Concordia retained Ivan Hofmann to analyze and quantify the financial dam­ages Concordia experienced as a result of the pharmaceutical database listings for Method’s Me-PF-Hypos products. The court concludes Hofmann’s opinion re­garding the amount of lost profit damages incurred by Concordia must be excluded. The Court finds that Concordia has failed to establish that Hofmann’s lost profit calculations were the product of reliable principles and methods that were reliably applied to the particular facts of this case. Hofmann’s methodology in reaching his conclusions failed to take into account numerous market factors that could have affected Donnatal sale and prescriptions and was based on selectively chosen data and unsupported assumptions. The re­liability of his lost profits calculations is further undermined by the fact that they are based on assumptions unsupport­ed by the record. The court will exclude Hofmann’s opinion that Concordia suf­fered “no less than $29.4 million” in lost profits from June 2014 through June 2015 due to the listing of Me-PB-Hyos in the pharmaceutical databases.

Finally, in light of the exclusion of Hofmann’s opinion evidence, the court will dismiss without prejudice the motion to exclude testimony by John Wills, Meth­od’s rebuttal damages expert.

Concordia Pharmaceuticals Inc. v. Method Pharmaceuticals LLC (Conrad) No. 3:14cv16, April 13, 2016; USDC at Charlottesville, Va.; Edward J. Allera for plaintiff; Jordan E. McKay for defendant. VLW 016-3-184, 16 pp.