The overwhelming majority of courts (including all seven federal circuits that considered the issue) have rejected the so-called “innovator liability” doctrine. In 2017, however, the California Supreme Court in T.H. v. Novartis Pharm. Corp. unanimously recognized the doctrine holding that brand-name prescription drug manufacturers owe a duty to warn to consumers who use generic drugs. In March of 2018, the Massachusetts Supreme Judicial Court (SJC) considered the issue, and took a middle ground. Specifically, in Rafferty v. Merck & Co., Inc., the SJC held that plaintiffs who ingest the generic form of a drug may bring failure to warn claims against the brand-name manufacturer of the drug if the brand-name defendant acted recklessly by “intentionally fail[ing] to update the label on its drug while knowing or having reason to know of an unreasonable risk of death or grave bodily injury associated with its use.” In so doing, the SJC reasoned that a plaintiff is, in fact, injured by a brand-name product’s label despite never having used said product because statutes require identical labeling of the generically manufactured version.
In 2010, a physician prescribed Finasteride, the generic version of the brand name drug Proscar, to treat Rafferty’s enlarged prostate. Rafferty experienced anticipated temporary side effects from the drug, causing him to stop taking the medication. Rafferty, however, continued to experience these side effects and his physician informed him that they could actually continue “indefinitely.” The potential lifelong side effects of this drug were not disclosed within the brand-name manufacturer’s nor the mirrored generic manufacturer’s warning label. Rafferty presented evidence that the brand-name manufacturer became aware of these potential long-term side effects by 2008, when it updated Proscar’s warning label in select European markets to include this risk.
Rafferty filed suit against the brand-name manufacturer in 2013, asserting a claim of negligence for, inter alia, failure to warn and for violation of the Commonwealth’s Consumer Protection Statute, G.L. c. 93A. The Superior Court dismissed Rafferty’s claims, “ruling that [the brand-name defendant] owed no duty of care to [him].” The SJC took over the case by its own motion from the Appeals Court.
The SJC Weighs In
Traditionally, Massachusetts has not recognized liability for products manufactured by others. However, the SJC noted that The Restatement (Third) of Torts allows a modification to this general rule in exceptional cases. The SJC considered innovator liability to require such a modification given the certainty that a user of a generic drug will rely on the label fashioned by the brand-name manufacturer and as state law shields failure to warn claims from generic manufacturers, leaving plaintiffs without recourse for their injuries. However, the SJC also recognized that imposing innovator liability could impact the public policy of encouraging innovation in the drug market and a potential increase in drug pricing.
Balancing these competing interests, the court held that, “a brand-name manufacturer