Xarelto Subrogation Shows Promise With Plaintiffs’ 1st Trial Win

A Philadelphia jury handed down a roughly $28 million verdict against Johnson & Johnson and Bayer AG on Tuesday, December 5, giving hope to tens of thousands of Xarelto plaintiffs after a series of defense verdicts in the federal multidistrict litigation (MDL) currently pending in the Eastern District of Louisiana. This is also very good news for subrogees and prospective lienholders who have paid hundreds of millions, if not billions, of dollars for treatment of Xarelto-related injuries.

Xarelto (rivaroxaban) is a type of anticoagulant, which are drugs used to prevent clotting conditions, chiefly deep vein thrombosis and pulmonary embolism, by thinning the blood. Use is common following hip surgeries and among pXarelto Litigationatients with atrial fibrillation. More specifically, Xarelto is part of a subclass known as “new oral anticoagulants” (NOAC). The claimed advantages of NAOCs over traditional anti-coagulants like Coumadin (warfarin) include the absence of food interactions, fewer drug interactions, and a substantially reduced need for medical monitoring. However, Xarelto has also been associated with an increased risk of adverse and often life-threatening bleeding events, gastrointestinal hemorrhage being the most common type.

A multitude of plaintiffs have alleged that the manufacturers of Xarelto failed to provide adequate warnings about the increased risk of bleeding. The bulk of cases are consolidated in the federal MDL, which as of mid-November encompassed more than 19,000 cases. More than 1,500 other actions are consolidated in the Philadelphia Court of Common Pleas’ Complex Litigation Center as a mass tort program. That is where Lynn Hartman’s case was tried and won on Tuesday. Hartman v. Janssen Pharmaceuticals Inc., et al., Court of Common Pleas of Philadelphia County, Pennsylvania.

The $28 million verdict against Johnson & Johnson and Bayer was a much-needed victory for Xarelto plaintiffs collectively. The federal litigation, now three years deep into the MDL process, has seen three bellwether trials and three consecutive defense verdicts within a relatively short period of time this year. In Re: Xarelto (Rivaroxaban) Products Liability Litigation, E.D. La. Case No. 2:14-md-02592. Needless to say, momentum has been with the defendants, but that does not appear to have discouraged or deterred the plaintiffs.

According to the Judicial Panel on Multidistrict Litigation (JPML) the number of pending cases has gone up by 2,361 between May 15, 2017 (just after the first defense verdict) and November 15, 2017 (the latest figures as of the date of this article)—an increase of nearly 15%. As the total number of cases continue to rise, the rate will slow eventually, but for the foreseeable future, interested subrogation professionals can expect a steady amount of growth, independent of this new win for the plaintiffs.

These are positive signs not only for the claimants, but for mass tort subrogation (MTS) as well. In short, a rising tide lifts all ships. That which gives the claimants more leverage to reach a favorable settlement generally increases the prospect of favorable conditions for MTS recovery. A sizeable verdict against the defendants—especially when none have come before it—drastically increases their assessment of the risk posed by future trials. Uncertainty and the perceived risk of loss is a fundamental factor in the decision of whether and how to settle.

Additionally, the Philadelphia verdict should spur a boost in optimism and confidence in the Xarelto litigation, resulting in a concomitant increase in the number of cases filed. Notwithstanding the outcome of the litigation, more claimants means a higher baseline litigation cost for the defendants. More importantly, additional claimants mean an increase in the collective amount of damages for which the defendants may be liable. In other words, not only may the defendants have a higher estimated risk of being held liable, they may have a higher risk of an increasingly larger loss.

Whether this first victory will turn the tide, no one can say, but it certainly can’t hurt. Xarelto litigation—and subrogation by association—is still a very viable endeavor. From a practical standpoint, Xarelto is a good candidate for MTS notwithstanding the liability issues. Xarelto and other NAOC-related bleeding events are relatively easy to identify compared to many other defective drug complications and the disproportionately large number of claimants increases the likelihood that an injured insured or plan beneficiary is among them. If the Hartman verdict does, in fact, make a substantial impact and move the Xarelto litigation toward settlement, now is probably a good time to start protecting one’s potential future recovery rights. If you have any questions about Xarelto litigation or mass torts subrogation, feel free to contact Tim Mentkowski at tmentkowski@mwl-law.com.

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