Duty to Innovate? A Possible New Standard for Negligence in Products Liability Claims

Gilead is a pharmaceutical company that manufacturers a variety of antiretroviral drugs used to treat and/or prevent the contraction of the AIDS virus. These drugs contain some version of a tenovir-based compound. More specifically, some of these drugs contain tenofovir disoproxil fumarate (“TDF”) as an active ingredient, and in October 2001, the FDA approved Gilead’s first drug containing this TDF compound.

Other antiretroviral drugs used to treat and/or prevent AIDS that are made by Gilead contain the drug compound tenofovir alafenamide fumarate (“TAF”) rather than TDF. Gilead began producing the TAF-compound version of its antiretroviral drug about one year after it began producing the TDF-compound drug.

A class of plaintiffs is currently suing Gilead pharmaceuticals for allegedly failing to produce the TAF-compound version of its drug, rather than the TDF-compound version, despite the knowledge that the TAF-compound was purportedly safer to use than the TDF-version. The plaintiffs involved in the lawsuit allege that, as part of their use of the TDF-compound version of the antiviral drugs, they suffer from kidney disease and bone loss. The plaintiffs argue that, had Gilead produced and delivered a safer version of its antiretroviral drug sooner, they would have suffered fewer side effects.

What makes this lawsuit unique, however, is that the plaintiffs are not alleging the product is defective. In fact, the plaintiffs agree that TDF drugs have benefited and continue to benefit patients. Rather, the plaintiffs are alleging that Gilead knew that a safer version of the drug could be developed – the TAF-compound version – and therefore had a duty to continue development of the TAF-compound version. In short, the plaintiffs allege that Gilead had a duty to innovate.

Typically, a products liability claim requires the plaintiff to show that the product was defective in some way. A product can be defective if the product itself is defective, or if the product contained too few warnings of the risks associated with that product.

Further, even when a safer alternative of a product is available, courts often balance the current product’s design against the cost, benefits, and efficacy of producing the safer alternative, in order to decide whether the manufacturer was negligent in failing to produce the safer alternative. Just because a safer product exists – or could come into existence with additional research and development – does not automatically require that the manufacturer produce the safer alternative of that product or else be deemed negligent. And yet, that is the crux of the plaintiff’s argument in this case.

The court’s ruling – on whether Gilead had a duty to further research and develop the safer TAF-compound version of its antiretroviral drug – could upend tort litigation as we know it, for many industries beyond the pharmaceutical industry, for at least a few reasons.

First, if the court were to rule in the plaintiff’s favor, the court would potentially create a new standard of liability for negligence claims by imposing on plaintiffs a duty to further research and develop safer alternatives to their products.

Second, there would be an open question of when enough is enough. In other words, if an already-safe version of a product is being produced, how much further research and development would a manufacturer need to do to avoid liability for that product? When is the ceiling on research and development reached?

Third, this would likely stifle creativity and innovation within many major industries because, if the court were to find that Gilead was negligent in failing to innovate and make a safer version of its product, other major industries could soon be found liable based upon similar claims. Thus, manufacturers would presumably hesitate to produce any products – let alone develop new ones – unless and until they were absolutely certain that they had reached the maximum limits on their product’s development, both now and for future research and development. And, echoing the immediately prior point, this question would be an open question.

And, of course, embedded within each of these concerns is the cost factor. If a manufacturer is required to constantly innovate its products to make an already-safe product even safer, the costs of research and development would drive up the cost of the finished product. This could result in disturbing realities in the healthcare industry, where many patients often find life-saving drugs out-of-reach due to cost.

The parties on each side of the case are currently briefing their responses to several questions which the court posed at the most recent hearing in September. The supplemental briefs are due to the court on or before October 9, 2023.