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Counterfeit Drugs: A New Source of Product Liability?

Drug counterfeiting robs pharmaceutical manufacturers of their investment in patents, trademarks, copyrights, and trade dress. It robs pharmacists and consumers of money, for worthless and sometimes dangerous products. It undermines the integrity of and consumer confidence in the American health care industry and in the government's ability to regulate it. More troubling than all these systemic evils, drug counterfeiting has the potential to allow controllable illnesses to ravage patients unchecked, to spread rather than stop disease, and to injure and kill.

Traditionally, however, manufacturers have at least been insulated from personal injury tort liability when counterfeit drugs cause harm: The counterfeiter alone possesses criminal intent and the manufacturer is remote to the injury. However, recently, under a number of theories, plaintiffs have alleged negligence on the part of pharmaceutical manufacturers for counterfeiting of their products. For example, a current lawsuit in St. Louis alleges that a breast cancer patient took a counterfeit form of Procrit' 20 times less potent than the genuine drug. According to a report in The San Francisco Chronicle, the attorney representing this plaintiff hopes to transform this suit into a class-action lawsuit. In another recently settled case involving the distribution of counterfeit Serostim', the only growth hormone approved by the FDA for the treatment of AIDS wasting, the lawsuit named the drug's manufacturer, along with the pharmacy and drug distributors.

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