By Matt Fair
Law 360, New York (June 25, 2012, 505 PM ET) – Merck and Co. Inc. was hit with a putative antitrust class action in Pennsylvania federal court Friday by an Alabama medical provider alleging the pharmaceutical company lied about the efficacy rate of its mumps inoculation in an effort to keep competitors from bringing their own versions of the vaccine to market.
Chatom Primary Care PC accuses Merck of concealing test results and falsifying studies to artificially maintain the vaccine’s claimed 95 percent efficacy rate and intimidate rivals from producing their own version. Since 1967, Merck has been the sole pharmaceutical company in the U.S. licensed to produce mumps vaccine.
“Merck has maintained this monopoly not through its legitimate business acumen and innovation or its manufacture and sale of the safest, most effective and most cost-effective Mumps vaccine in the market,” the complaint said. “Instead, Merck has willfully and illegally maintained its monopoly through its ongoing manipulation of the efficacy of its Mumps vaccine.”
The complaint comes in the wake of a False Claims Act case brought by two former Merck employees similarly alleging the company used improper testing techniques and falsified vaccine data to artificially inflate the efficacy rate of its mumps vaccine. That case was unsealed in Pennsylvania federal court June 19 after the federal government declined to intervene.
The two employees said the government, which purchases more than half of the mumps vaccines produced by Merck, has spent hundreds of millions of dollars on ineffective medicine.
While substantially mirroring the allegations raised in the ongoing False Claims Act case, the putative class action filed Friday alleges that Merck’s behavior resulted in artificially high vaccine prices by effectively barring competitors from manufacturing their own vaccines.
“As with the market for any product, a potential competitor’s decision to enter a market hinges on whether its product can complete with those products already being sold in the market,” the complaint said. “ If an existing vaccine is represented as safe and at least 95 percent effective, as Merck has falsely represented its vaccine to be, it would be economically irrational for a potential competitor to bring a new Mumps vaccine to the relevant market.”
Officials from Merck rejected the suits Monday, pointing out that the government declined to get involved in the FCA case after its own two-year investigation.
“This lawsuit is completely without merit, and we intend to vigorously defend against the allegations,” Merck spokesman Ron Rogers said. “Nothing is more important to Merck than the safety and efficacy of our vaccines and the people who use them.”
Friday’s complaint says Merck’s mumps vaccine, which it incorporates into its MMRII and ProQuad inoculations, has lost significant potency over time and failed to prevent significant mumps outbreaks in the U.S. in 2006 and 2009. In addition to mumps, the vaccines are intended to immunize recipients against measles, chickenpox and rubella.
In 2006, more than 6,500 mumps cases were reported in the Midwest, the suit says. According to the complaint, 84 percent of the young adults who contracted the disease at the time were vaccinated against it. Another 5,000 cases were reported across the country in 2009, the complaint says.
The vaccine contains a sample of the mumps virus strong enough to trigger an immune response in humans – thereby generating immunity – but too weak to cause serious illness.
However, as the vaccine has been synthesized repeatedly from the same strain of the mumps virus since its first manufacture in 1967, it has slowly become less and less potent over time, the complaint says, adding that Merck has been aware of the vaccine’s shortcomings for more than a decade.
“Merck knew and understood that the continued passaging of the attenuated virus from which its Mumps vaccine was created (over 40 years ago) had altered the virus and degraded its efficacy,” the complaint said.
When tests showed the vaccine was losing its effectiveness, the complaint says, Merck concealed the results and devised new studies with “scientifically flawed methodology” in an effort to get the outcome it wanted.
“The goal of this new efficacy testing was to support its original efficacy findings at all costs, including the use of scientifically flawed methodology and falsified test results,” the complaint said.
Chatom seeks to represent anyone who purchased mumps vaccines from Merck between Jan. 1, 1999, and the present.
The suit levies accusations against Merck of unjust enrichment, antitrust violations, breaking state consumer protection and warrants laws across the U.S. It seeks treble damages under federal antitrust laws as well as equitable relief for class members.
Chatom Primary Care PC is represented by Richard Golomb and Steven Resnick of Golomb & Honik, PC, Hollis Salzman, Bernard Persky, Christopher McDonald, Kellie Lerner and Elizabeth Friedman of Labaton Sucharow LLP (/firms/labaton-sucharow), Stephen Dampier of Dampier Law Firm PC, and R. Edward Massey Jr. of Clay Massey & Associates PC.
Counsel information for Merck was not immediately available.
The case is Chatom Primary Care PC v. Merck & Co (/companies/merck-co-inc). Inc., case number 2:12-cv-03555, in U.S. District Court for the Eastern District of Pennsylvania.
–Additional reporting by Lana Birbrair. Editing by Jocelyn Allison and Lindsay Naylor.
