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By Lawrence Hurley
WASHINGTON, June 6 (Reuters) - The U.S. Supreme Court onMonday declined to hear GlaxoSmithKline Plc's bid to throw outlawsuits by union health and welfare funds that said thecompany's misrepresentation of heart-related risks of itsdiabetes medication Avandia caused them to pay too much for thedrug for insured patients.
The court left in place an October 2015 ruling by thePhiladelphia-based 3rd U.S. Circuit Court of Appeals againstLondon-based GlaxoSmithKline that allowed the classaction lawsuits to proceed. The suits were filed by three laborunion funds that provide medical coverage, including the cost ofprescription medications, to union members and their families.
In lawsuits filed between 2007 and 2010, Allied ServicesDivision Welfare Fund, UFCW Local 1776 and ParticipatingEmployers Health and Welfare Fund, and United Benefit Fundallege that GSK violated the Racketeer Influenced and CorruptOrganizations Act, or RICO, by fraudulently concealing the riskof cardiovascular injury.
The RICO law is used to target illegal conspiraciesincluding organized crime.
Avandia was introduced in the United States in 1999, but theFood and Drug Administration required new warning labels in 2007and sharply restricted its use between 2010 and 2013 afterstudies linked the drug to an increased risk of heart attack.
GSK has since settled claims by 46 U.S. states and thousandsof users, without admitting any wrongdoing.
The health and welfare benefit funds, known as "third-partypayors" or TPPs, contend they were tricked into paying for moreAvandia prescriptions, and at a higher rate, than they wouldhave done had they known the health risks posed by the drug. (Reporting by Lawrence Hurley; Additional reporting by BarbaraGrzincic; Editing by Will Dunham)
