CHINESE DRUG CO. CHIEF MUST TESTIFY IN TAINTED VALSARTAN MDL

The special master in multidistrict litigation alleging that pharmaceutical companies sold generic drugs containing the active ingredient valsartan that were tainted with carcinogens ruled on Tuesday that the president of Zhejiang Huahai Pharmaceutical Co. Ltd. can’t be blocked from giving a deposition in the case.

Special Master Thomas I. Vanaskie, a retired judge, denied a motion from Zhejiang, Huahai US Inc., Prinston Pharmaceutical Inc. and Solco Healthcare US LLC to preclude deposition of Baohua Chen, saying the plaintiffs in the case have shown that he is not a hands-off manager but would have information about the product, the contamination and the resulting recall at the heart of the suit.

The companies had argued that Chen could not be deposed because it would be an undue burden.  In addition, they cited the “apex doctrine,” which holds that those at the apex of a company — such as CEOs and presidents — may not have day-to-day knowledge of the company’s operations.

In the motion, the companies argued that Chen’s role is managerial and that he mainly receives reports and accepts decisions from more knowledgeable employees. They say he was not involved in the manufacture of the drugs, the discovery of the contamination or the recall of the products.

Vanaskie, however, sided with the plaintiffs, who said Chen is a chemical engineer and is described in Zhejiang’s documents as having experience in product development and quality management of bulk drugs. 

The consumers allege that manufacturers such as Zhejiang misrepresented that the valsartan-containing drugs were therapeutically equivalent to the reference-listed drug — the approved drug to which generic versions are compared to show they are bioequivalent — and properly branded, according to the opinion. The consumers said those representations were false because the generics contained carcinogens known as N‐nitrosodimethylamine and N‐nitrosodiethylamine, which rendered the generics non-bioequivalent to the reference-listed drug.

Law360: https://www.law360.com/articles/1396436/chinese-drug-co-chief-must-testify-in-tainted-valsartan-mdl

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