Settlement reached over deadly U.S. meningitis outbreak
Owners and insurers of a now-bankrupt Massachusetts pharmacy linked to a deadly meningitis outbreak have agreed to pay more than $100 million to compensate victims, families of victims and creditors.
The preliminary settlement announced on Monday, which requires court approval, would resolve many claims arising from tainted steroid injections linked to New England Compounding Pharmacy Inc of Framingham, Massachusetts.
According to the Centers for Disease Control and Prevention, at least 64 people died and 751 were sickened in 20 U.S. states by injections of methylprednisolone acetate, a drug typically used to ease back pain.
The outbreak occurred after NECC shipped tainted vials of the steroid to medical facilities throughout the United States.
NECC filed for bankruptcy protection December 21, 2012, two months after shutting down as the outbreak began.
Thomas Sobol, a partner at Hagens Berman Sobol Shapiro representing a plaintiffs’ steering committee, called the accord “a big step forward in getting justice for victims.”
Kristen Johnson Parker, another Hagens Berman partner, in a phone interview said, “All victims of the NECC tragedy should be able to share in the funds.”
Meningitis outbreak may affect more than 23 states
The Centers for Disease and Control and Prevention (CDC) and Food and Drug Administration (FDA) announced today they are advising medical professionals not to use any products manufactured by the New England Compounding Center in Framingham, Mass., due to an outbreak of fungal meningitis tied to some medications made by the company.
Three lots of the company’s preservative-free methylprednisolone acetate that go back to July 2012 have been recalled and are believed to be the cause of the recent outbreak. Thirty-five cases of fungal meningtitis in six states have been identified, with five deaths. The majority of the cases, 25 in total, have been discovered in Tennessee.
“Given the severity of illness, we believe these precautionary measures are warranted to protect public health,” Ilisa Bernstein, director of the FDA office of compliance, said to reporters during a conference call today.
Dr. Benjamin Park, medical epidemiologist with the Centers for Disease Control and Prevention, told reporters that 23 states may have received shipments of the tainted product. These states include: California, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Maryland, Michigan, Minnesota, North Carolina, New Hampshire, New Jersey, Nevada, New York, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Virginia, Texas and West Virginia. A total of 75 facilities may have received product from one of these three recalled lots.
NECC’s owners, bankruptcy trustee Paul Moore and lawyers for a committee of unsecured NECC creditors also confirmed the settlement in a joint statement. The owners denied liability or wrongdoing.
Settlement funds are expected to come from the owners, insurers, tax refunds and proceeds from the sale of a related business.
“We are pleased that a significant amount of funds will become available for distribution to victims and their families as compensation for the deaths, injuries and suffering they endured as a result of this tragic meningitis outbreak,” said Moore, a partner at Duane Morris.
The accord requires final documentation and does not cover claims against various clinics that sold the tainted steroid or various vendors used by NECC.
According to NECC’s bankruptcy filing, the company’s equity shareholders were Carla Conigliaro with a 55 percent stake, Barry Cadden and Lisa Conigliaro Cadden each with a 17.5 percent stake, and Gregory Conigliaro with a 10 percent stake.
A lawyer for the owners did not immediately respond to a request for comment.
Four more deaths have been linked to a meningitis outbreak caused by contaminated steroid injections made by a specialty pharmacy, U.S. health officials announced Wednesday. That brings the nationwide total to 19 deaths.
A Centers for Disease Control and Prevention (CDC) update listed 247 reported infections in 15 states on its web site. The agency had previously reported 233 infected Americans including 15 deaths in 15 states.
Two of the reported cases may be joint infections from steroid shots given in peripheral joints such as the knee, hip, shoulder and elbow. No deaths have been associated with peripheral joint infections, the CDC said.
One new death was reported in both Florida and Virginia, and two more deaths were reported in Tennessee, the state with the most reported infections with 61 cases.
The outbreak has been tied to methylprednisolone acetate steroid shots used for back pain made by a specialty pharmacy, New England Compounding Center, in Framingham, Mass. The center is currently under investigation by federal agencies.
The case is In re: New England Compounding Pharmacy Inc, U.S. Bankruptcy Court, District of Massachusetts, No. 12-19882.
(Reporting by Jonathan Stempel in New York; Editing by Bill Trott)
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By Jonathan Stempel