Manufacturer, Hospital Not Liable For Injuries Allegedly Caused By ‘Contaminated’ Antiviral Drug

In this case involving contaminated doses of an antiviral medication, the defendants were immune from liability under the federal Public Readiness and Preparedness Act because they did not engage in “willful misconduct” by manufacturing or administering the contaminated drug to the plaintiffs, the Michigan Court of Appeals has ruled.

The plaintiffs in DN v Gilead Sciences, Inc., et al. (Docket Nos. 367271 and 368026) sued the defendants, a pharmaceutical company and a hospital, in Washtenaw County Circuit Court regarding contaminated doses of remdesivir, an FDA-approved antiviral medication. The plaintiffs’ ward, DN, was hospitalized with COVID-19 in November 2021 and was given two doses of remdesivir. Afterward, DN suffered two strokes and became bedridden, requiring around-the-clock care. The plaintiffs later learned the remdesivir that DN received was  contaminated with glass particles and had been voluntarily recalled. The recall was published on the Food and Drug Administration (FDA) website.

The defendants, Gilead Sciences, Inc. (Gilead) and St. Joseph Mercy Hospital (St. Joseph), each filed motions to dismiss the plaintiffs’ claims. The defendants asserted they were immune from liability under the Public Readiness and Preparedness (PREP) Act, 42 U.S. Code §247d, because remdesivir was a “covered countermeasure.” The Washtenaw County trial court denied the defendants’ motions to dismiss.

The Court of Appeals reversed in a published opinion written by Judge Michelle M. Rick.

“The plain language of the PREP Act clearly grants Gilead and St. Joseph immunity from all liability for injuries that were not caused by willful misconduct,” Judge Rick said. “Because plaintiffs have not alleged that Gilead or St. Joseph engaged in willful misconduct by manufacturing or administering remdesivir to DN, plaintiffs’ claims cannot prevail.”

In its decision, the Court of Appeals pointed out that Congress “unequivocally extended immunity to scientists, pharmaceutical companies, and other healthcare providers who grappled with the unprecedented nature of the COVID-19 pandemic” and the PREP Act “extends immunity to those entities vis-à-vis any potential future health crises, barring allegations of willful misconduct.”

Judge Mark T. Boonstra and Judge Anica Letica joined the opinion.

State And Federal Claims

DN was diagnosed with COVID-19 by the staff at St. Joseph in November 2021. DN, who was 83 years old, was given monoclonal antibodies and discharged. The following day, DN’s symptoms worsened and he returned to St. Joseph, where he received two doses of remdesivir. Within the next week, DN suffered a stroke. He was discharged to a nursing facility, where he began suffering from hematomas and swelling of the face, thighs and arms. He suffered another stroke in December 2021 and required 24-hour care. As such, he was designated as being legally incapacitated.

In April 2022, DN’s guardian received a letter from St. Joseph confirming that DN had received remdesivir. The letter stated that two of the five doses that DN received included recalled lot numbers of the drug. The voluntary recall was dated December 3, 2021, and was published on the FDA’s website.

The plaintiffs sued Gilead and St. Joseph in Washtenaw County Circuit Court, asserting breach of implied warranty, breach of express warranty, negligence, gross negligence, intentional misrepresentation and loss of consortium regarding the contaminated medication. The plaintiffs argued that, although the FDA had approved remdesivir, the remdesivir administered to DN “was not in accordance with Gilead’s FDA approval for the drug in terms of its manufacturing quality” because it contained glass particles. The plaintiffs alleged that the glass particles caused DN to suffer two strokes, that DN ultimately had to have a leg amputated and, as a result, DN was left bedridden and required around-the-clock care.

Gilead, with consent from St. Joseph Mercy, removed the lawsuit to the federal district court, claiming the PREP Act, 42 USC 247d-6d, preempted the plaintiffs’ state-law claims. In Nowacki v Gilead Sciences, Inc. (Case No. 23-10276) (unpublished order of the U.S. District Court for the Eastern District of Michigan, June 13, 2023), the district court said the PREP Act preempted state-law claims that fall within its scope and “[t]he sole cause of action created by the PREP Act is an exclusive Federal cause of action against a covered person for death or serious physical injury proximately caused by willful misconduct … by [a] covered person[.]” The court said the only claim over which it had original jurisdiction was the intentional misrepresentation claim because the PREP Act “completely preempt[ed]” the claims alleging death or serious injury caused by willful misconduct. The court noted that under the PREP Act, a plaintiff who asserts a willful misconduct claim must first exhaust all administrative remedies before bringing that claim in federal court. Because the plaintiffs had not yet exhausted all their administrative remedies, the court dismissed this claim without prejudice. The court also declined to exercise supplemental jurisdiction over the plaintiffs’ remaining claims.

The federal district court also rejected the plaintiffs’ argument that the remdesivir doses were not a covered countermeasure under the PREP Act. “The Act’s broad grant of immunity from suit and liability with respect to all claims relating to the administration to or use of a covered countermeasure … makes clear that a product’s alleged departure from FDA-approved manufacturing specifications does not remove it from the Act’s protection,” the court stated.

The federal court remanded the case to the Washtenaw County trial court. Thereafter, Gilead filed a motion for summary disposition under MCR 2.116(C)(8), arguing it was immune from suit under the PREP Act because remdesivir was a covered countermeasure. Gilead also argued that, as remdesivir’s manufacturer, it was immune from liability for all claims of loss caused by the use of remdesivir. According to Gilead, the PREP Act’s plain language granted immunity from manufacturing defect claims, such as the contaminated remdesivir that was administered to DN. St. Joseph also moved for summary disposition on basically the same grounds, claiming that under the PREP Act, it was a “covered person” immune from liability for injuries related to the administration of a “covered countermeasure” such as remdesivir.

The plaintiffs responded by asserting the PREP Act did not afford Gilead protection because the FDA did not approve remdesivir in a form that contained glass particles. As a result, the plaintiffs argued the allegedly contaminated remdesivir doses did not constitute a covered countermeasure.

The Washtenaw County trial court denied Gilead’s motion for summary disposition. The trial court reasoned: “[I]t’s not claimed here that there was a problem with the formula; it’s claimed that there was a problem with the product that was ultimately delivered. And under those circumstances I don’t see that the PREP Act applies here to bar the claims that are made by the Plaintiff of a negligent manufacture.”

The plaintiffs also responded to St. Joseph’s motion for summary disposition, asserting that because St. Joseph filed essentially the same motion as Gilead – and Gilead’s motion was denied – St. Joseph’s motion should also be denied. The trial court agreed, rejecting St. Joseph’s motion for basically the same reasons it denied Gilead’s motion.

Gilead and St. Joseph appealed.

No Liability

On appeal, Gilead and St. Joseph argued the trial court erroneously denied their motions for summary disposition because the PREP Act’s plain language granted them immunity from manufacturing defect claims.

“We agree,” the Court of Appeals said, citing Hudak v Elmcroft of Sagamore Hills, 58 F. 4d 845 (6th Cir. 2023). The appeals court pointed out that, in Hudak, the 6th U.S. Circuit Court of Appeals said that Congress enacted the PREP Act “to encourage the expeditious development and deployment of medical countermeasures during a public health emergency by allowing the [HHS] Secretary to limit legal liability for losses relating to the administration of medical countermeasures such as diagnostics, treatments, and vaccines.”

Next, the Court of Appeals noted that under the plain language of the PREP Act, “a covered person shall be immune from suit and liability under Federal and State law with respect to all claims for loss caused by, arising out of, relating to, or resulting from the administration to or the use by an individual of a covered countermeasure if a declaration under subsection (b) has been issued with respect to such countermeasure.” According to the appeals court, there was “no dispute” the HHS Secretary “declared COVID-19 a public-health emergency in March 2020” and “[i]mmunity under the Act was extended through October 1, 2024.”

The Court of Appeals then closely examined the language of the PREP Act. “[R]elevant to this appeal, ‘loss’ is defined as including losses caused by death or by ‘physical, mental, or emotional injury, illness, disability, or condition[.]’ … The PREP Act additionally defines the phrase ‘covered person’ to include entities that manufacture, distribute, prescribe, and administer a covered countermeasure.” In this case, the plaintiffs acknowledged that Gilead and St. Joseph were “covered persons,” the appeals court noted.

Meanwhile, the PREP Act defines “covered countermeasure” as “a qualified pandemic or epidemic product” or “a drug … that is authorized for emergency use in accordance with section 564, 564A, or 564B of the Federal Food, Drug, and Cosmetic Act,” the Court of Appeals observed. Regarding this definition, the plaintiffs “agree[d] that in general, remdesivir is considered a covered countermeasure,” the appeals court noted.

However, the plaintiffs maintained that the remdesivir administered to DN “should not be considered a ‘covered countermeasure’ because Gilead manufactured, and St. Joseph administered, a product containing microscopic glass particles,” the Court of Appeals explained. According to the plaintiffs, “it [was] the glass particles, and not the remdesivir itself” that caused DN’s injuries.

“We understand plaintiffs’ argument,” the Court of Appeals wrote. “Nevertheless, Congress acted to prevent suits like this in the face of a serious public health emergency. Gilead and St. Joseph are ultimately correct: under the PREP Act, no liability can attach here. The immunity granted under the PREP Act ‘applies to any claim for loss that has a causal relationship with the administration to or use by an individual of a covered countermeasure, including a causal relationship with the design, development, clinical testing or investigation, manufacture, labeling, distribution, formulation, packaging, marketing, promotion, sale, purchase, donation, dispensing, prescribing, administration, licensing, or use of such countermeasure.’”

The Court of Appeals explained that the PREP Act includes “only one exception” to immunity. “The sole basis for which liability can be imposed under the PREP act is ‘for death or serious physical injury proximately caused by willful misconduct,’ …. The Act defines willful misconduct as ‘an act or omission that is taken – (i) intentionally to achieve a wrongful purpose; (ii) knowingly without legal or factual justification; and (iii) in disregard of a known or obvious risk that is so great as to make it highly probable that the harm will outweigh the benefit.’”

Therefore, under the plain language of the PREP Act, “Gilead and St. Joseph cannot be held liable for any alleged wrongdoing short of ‘willful misconduct,’” the Court of Appeals said. “Plaintiffs did not plead in avoidance of the PREP Act by alleging that Gilead or St. Joseph engaged in willful misconduct in this case, nor does it appear that an unintentional error allegedly causing contamination of the remdesivir during the manufacturing process rises to the level of willful misconduct for which Gilead and St. Joseph can be held liable.”

Further, “as Gilead pointed out in the federal district court, ‘Congress’s explicit extension of PREP Act immunity to claims involving a covered countermeasure’s “manufacture” would be rendered meaningless if, as Plaintiffs suggest, the presence of a manufacturing defect prevented a product from being a covered countermeasure in the first place,’” the Court of Appeals said. “To accept plaintiffs’ argument and conclude that manufacturing defects prevent products from being considered ‘covered countermeasures’ under the PREP Act, we would necessarily have to render some of the language of the PREP Act nugatory, in violation of our principles of statutory interpretation. … We decline to do so here.”

As a result, the trial court “erred by declining to grant summary disposition under MCR 2.116(C)(8),” the Court of Appeals held. “On remand, the trial court shall enter an order granting summary disposition to Gilead and St. Joseph under MCR 2.116(C)(8) and dismissing plaintiffs’ claims in their entirety.”