On Tuesday, January 9, 2024, in a unanimous decision, the First District Court of Appeal of California made clear that drug manufacturers like Gilead cannot escape liability for their negligent decision-making – in this instance Gilead’s decision to withhold the safer HIV anti-viral drug (TAF) in order to maximize its profits.

Gilead’s internal documents which were part of the record on appeal, revealed that Gilead possessed a safer HIV anti-viral drug and withheld its release to maximize profits.  As stated in the opinion: “a decision that deprives people of a safer drug and leaves them reliant on a more dangerous drug is morally blameworthy”.

The case – Gilead Tenofovir Cases A165558 is a California Coordinated Proceeding that involves more than 24,000 people who allege that they have suffered kidney injury and bone loss as a result of taking TDF, (tenofovir disoproxil fumarate), an anti-viral medication used to treat people infected with HIV or those at risk for contracting HIV.  Plaintiffs claim that Gilead’s decision to withhold a safer HIV anti-viral drug (TAF) was made in order to maximize its profits and was unreasonable.

The Court affirmed the legal duty of a manufacturer to exercise reasonable care extends beyond simply making a non-defective product.    “First, we conclude that the legal duty of a manufacturer to exercise reasonable care can, in appropriate circumstances, extend beyond the duty not to market a defective product.”  As the Court noted, this duty of reasonable care is based on long-standing California law found in California Civil Code 1714 that everyone has a duty to act reasonably not to cause foreseeable harm to others, and applies to pharmaceutical manufacturers when they make decisions about the commercialization of alternative drugs.  The Court rejected Gilead’s claim that it should be immunized from that general duty of care, and decided these cases can proceed to trial.

Quotes from the opinion:

While Gilead was developing TDF, it discovered a similar, but chemically distinct, potential drug, tenofovir alafenamide fumarate (TAF).  Plaintiffs allege that Gilead’s early testing indicated TAF could be as effective as TDF at treating HIV/AIDS, while carrying a lower risk of adverse effects.  According to plaintiffs, however, Gilead elected to defer development of TAF because it was concerned that the immediate development of TAF would reduce its financial return from TDF.  Years later, Gilead resumed the development of TAF and obtained FDA approval for its sale in 2015. …

In context, then, the duty question we must address is whether a drug manufacturer, having invented what it knows is a safer, and at least equally effective, alternative to a prescription drug that it is currently selling and that is not shown to be defective, has a duty of reasonable care to users of the current drug when making decisions about the commercialization of the alternative drug. … In those circumstances in which a manufacturer’s duty of reasonable care properly extends beyond the duty not to market a defective product, a claim for negligence continues to provide a remedy. …

Schneider Wallace Cottrell Konecky partner Amy Eskin is the Court appointed Co-Lead of the California Coordinated Proceeding JCCP 5043, The firm represents many people injured as a result of taking TDF drugs.  These drugs include:

• TRUVADA®
• VIREAD®
• ATRIPLA®
• STRIBILD®
• COMPLERA®