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for companies to move overseas where liability is decreased. The U.S. liability climate raises the cost of product here so that when we export it, the potential for others to underprice increases. |
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In isolated cases, the government will indemnify a manufacturer for a needed product that is associated with liability. Lawsuits against vaccine manufacturers began to increase greatly during the 1970s [39]. It was partially out of concern that many pharmaceutical companies were getting out of the vaccine business that Congress in 1986 enacted the Childhood Vaccine Injury Act which established the Childhood Vaccine Compensation Program [40]. One of the purposes of this federally subsidized compensation program was to pay people with government funds outside the normal tort system in situations where inoculation is involuntary as in the case of childhood vaccines. This was an incentive for manufacturers to distribute these much-needed vaccines without fear of liability. Under this program, anyone claiming to have suffered injury from one of the listed childhood vaccines may file a petition with the U.S. Court for Federal Claims for compensation. More than 4800 claims were filed and because the awards were higher than predicted, Congress was forced to appropriate additional funds to deal with these extra cases. In 1976, under the Swine Flu Immunization Program, the government also agreed to indemnify vaccine manufacturers. Approximately 4179 claims were filed seeking a total of $3,211,072,540 of which the government paid out slightly less than $100 million [41]. These lawsuits continue with large awards to plaintiffs. In October 1994, a jury awarded $13.5 million to a patient who developed Guillain-Barre Syndrome resulting in paralysis [42]. |
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These large judgements place increasing pressure on manufacturers to conduct pharmacoepidemiologic (PE) studies. The PE study can take place at any time during the drug development process and such studies have been used to refute unsubstantiated allegations about a product and avoid liability [1,43]. In the future, there will likely be a still greater demand for better pharmacoepidemiologic information to prevent drugs from becoming litogens. |
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D. Product Liability Reform |
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There remains no uniform standard of product liability law in the United States and uncertainty prevails as the rules continue to vary from state to state. Insurance is often prohibitively expensive and some pharmaceutical companies self-insure. Others purchase only product-recall insurance to cover expenses incurred for recalls but not litigation. |
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Product liability legislation has been introduced in every Congress for the past 14 years. Each year the call for liability reform grows stronger from industry. Economic caps on awards and contingency fees redress only the symptoms of a disease that is deeply rooted in the liability system. |
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