The Texas Supreme Court answered yes in its recent decision Randol Mill Pharmacy v. Miller, 2015 WL 1870058 (Tex. Apr. 24, 2015). And while the decision is full of statutory interpretation of the Texas Medical Liability Act, which wouldn’t normally draw our interest, when we read this one we saw some implications for pharmacy liability we didn’t like. That’s bad for pharmacies. It is also bad for manufacturers who look to get pharmacy defendants who may create a bar to federal removal dismissed as fraudulently joined.
The facts are fairly straightforward. Plaintiff’s physician prescribed and administered weekly injections of lipoic acid to treat plaintiff’s hepatitis C. Plaintiff suffered an adverse reaction to one injection and alleges she has been left blind as a result. Id. at *1. Plaintiff sued both the pharmacy who compounded the lipoic acid and several of its pharmacists. The pharmacy and pharmacists moved to dismiss for plaintiff’s failure to serve an expert report within 120 days of filing as required by the Medical Liability Act. Plaintiff argued that her claims against the pharmacy/pharmacists were products liability claims, not healthcare liability claims and therefore the statute did not apply. Both the trial and intermediate appellate courts agreed with plaintiff concluding that the pharmacists were not healthcare providers. Id.
Plaintiff’s allegations against the pharmacy defendants include:
- negligence in manufacture, design and warning;
- breach of implied warranties in the design, manufacture, inspection, marketing, and/or distribution;
- and what essentially sounds like strict liability manufacturing, design and warning claims (“inappropriate warnings and instructions for use,” the produce “was defective, ineffective and unreasonably dangerous.” Id.
These sound like products liability claims to us. And in the products liability arena, pharmacy liability is usually a loser. That is because the main allegation against the pharmacy is failure to warn. Under the learned intermediary rule, all warnings to patients must be funneled through prescribing physicians. Just as drug companies have no duty to warn patients, neither do pharmacies. All pharmacies have to do is fill prescriptions accurately (with some exceptions). So, when plaintiffs sue both the drug manufacturer and the pharmacy in state court with no allegation that the pharmacy provided the wrong product or that the product became tainted while in the control of the pharmacy – some actual wrongdoing – our antennae go up and we start thinking fraudulent joinder. Rightfully so because manufacturers have had a good deal of success on this front.
But what if pharmacists are healthcare providers? Does that get plaintiffs over the fraudulent joinder hurdle of a colorable claim? In Texas, a pharmacist may be liable as a healthcare provider for “activities limited to the dispensing of prescription medicines which result in health care liability claims,” but not for “any other cause of action that may exist at common law against [pharmacists], including but not limited to causes of action for the sale of mishandled or defective products.” Id. at *7. We prefer pharmacies in the latter category – sellers of products. Because that’s where manufacturers can get them dismissed as fraudulently joined. And while the Texas Supreme Court was worried about the latter being interpreted too broadly so as to swallow the former, we’re worried about the exact opposite result.
As quoted above, plaintiff undeniably used products liability language in pleading her claims against the pharmacy defendants. But the court says we need to look at substance over form. OK, so look at how the court substantively describes the claims against the pharmacy:
In this case, Dr. Tan ordered compounded injectable lipoic acid for office administration to his patients, and the pharmacist defendants compounded the lipoic acid for that purpose. Dr. Tan administered the lipoic acid to Miller in the course of her treatment for Hepatitis C symptoms.
Id. Sounds like the pharmacy provided the drug that was prescribed by plaintiff’s physician and plaintiff suffered an adverse reaction to that drug. How is that different from the pharmacy that dispenses a prescription drug in pill form that plaintiff ingests and then alleges she was injured by? Sure, if the allegations went something like this: doctor prescribes xx drug at xxx dosage and pharmacist dispenses yy drug at yyy dosage – there would be a colorable claim against the pharmacy. But we don’t see those allegations here. Maybe they are in the complaint, but they aren’t in the opinion.
What is in the opinion is a conclusion that plaintiff’s allegations “at their core,” “call into question Randol Mill’s compliance with professional standards of care applicable to pharmacies that perform compounding services.” Id. at *8. Even more disturbing is the apparent recognition that failure to warn is one of those standards of care:
Miller asserts that the pharmacist defendants’ negligence in compounding the drug and their inclusion of inadequate warnings and instructions regarding its use proximately caused her injuries. Whether stated as negligence or breach of warranty, these claims rather clearly allege that the pharmacist defendants departed from accepted standards of health care.
Id. at *7 (emphasis added). That flies directly in the face of the learned intermediary doctrine.
Like we said, the case is full of statutory interpretation – layers upon layers of it. And, it also involves compounding which may lend itself to more direct negligence allegations (particularly claims of tainted product). And we think those things narrow the implication of this decision. But the inclusion of a duty to warn in a pharmacy’s “professional standards” is troubling. And fortunately without much support as you can see from our posts on pharmacy liability here. While we don’t like decisions that mess with manufacturers’ ability to remove cases to federal court, we can’t stand anything that even remotely calls into question the learned intermediary doctrine.