Takeda Pharmaceutical Co Ltd and Eli Lilly & Co lost a bid to overturn a combined $9 billion punitive damage award by a U.S. jury for hiding cancer risks associated with their Actos diabetes drug, according to a court ruling.
"Plaintiffs have pointed to sufficient evidence from which the jury could have concluded that the 'information' about bladder cancer contained in Actos labels did not adequately warn of the increased risk of cancer," U.S. District Judge Rebecca Doherty of the Western District of Louisiana said on Wednesday.
The development is a setback for Takeda but leaves open the possibility of a retrial or reduced verdict, for which Japan's top drugmaker made a separate appeal in April.
A spokeswoman called the latest ruling "unfortunate", adding that Takeda continued to hope for an outcome in its favor on the separate appeal. Takeda reiterated its intention to keep fighting in court rather than settle.
Legal experts have said it was unlikely that such a large award would stand after challenges in court by both companies.
Lilly, which co-promoted Actos from 1999 to 2006, was not immediately available to comment. The company has previously said it will be indemnified by Takeda for its losses and expenses from the litigation based on the terms of its agreement with Takeda.
Shares in Takeda reacted little to the news, rising 0.4 percent on Friday afternoon, against a slight fall in the broader Tokyo market.
Actos, an oral Type 2 diabetes medication that regulates blood sugar levels, has been on the market since 1999.
Takeda on Friday separately announced findings of a 10-year epidemiology study that concluded that there was no evidence to suggest that taking Actos led to an increased risk of bladder cancer.
Data from the study, conducted by the University of Pennsylvania and Kaiser Permanente Northern California, was submitted to regulatory authorities in the United States, Europe and Japan, it said.
This is the first federal case to be tried in consolidated multidistrict litigation comprising more than 2,900 lawsuits. In all three previous Actos trials, Takeda has said, judgments were entered in its favor.
(Reporting by Anjali Rao Koppala in Bangalore and Chang-Ran Kim in Tokyo; Editing by Lisa Shumaker and Matt Driskill)