The Zyprexa Papers: A Legal System for Drug Companies and Lawyers…Not the Public

Photograph Source: Momoneymoproblemz – CC BY-SA 4.0

On November 28, 2006, attorney Jim Gottstein received a phone call that would change his life. It would propel Gottstein into a legal war against the giant pharmaceutical company Eli Lilly, who would retaliate against him for his release of Lilly’s own documents about its drug Zyprexa. A U.S. District Court would rule that Gottstein had conspired to steal these documents, and Lilly would threaten Gottstein with criminal contempt charges. Gottstein’s The Zyprexa Papers (2020) is an account of his odyssey.

Lilly had good reasons to be fiercely protective of Zyprexa (the brand name for olanzapine), approved by the Food and Drug Administration (FDA) for people diagnosed with schizophrenia and bipolar disorder. Zyprexa, by 2017, had lifetime sales of $60.6 billion.

The phone call Gottstein received in 2006 was from physician Dr. David Egilman, who said that he had been hired as an expert witness by a law firm representing patients treated with Zyprexa who had developed diabetes or other metabolic problems.

Egilman, Gottstein recounts, “was feeling me out to see whether I might be willing to subpoena him, so he could legally send me secret documents. . . .[that] revealed the pharmaceutical company Eli Lilly had from the beginning suppressed information showing Zyprexa caused these life-threatening conditions. In addition, they showed Lilly had illegally marketed this powerful and dangerous drug for use in children and the elderly.”

Egilman had access to these documents from a suit brought against Lilly by Zyprexa victims, which had been settled for $700 million in 2005 (and for an additional $500 million in 2007, for a total of $1.2 billion for 28,500 people). Egilman, however, was legally bound by the settlement agreement to keep these Lilly documents secret from the public, and so he was hoping Gottstein would subpoena them from him. Egilman wanted Gottstein to get these Lilly documents to a reporter at The New York Times, Alex Berenson, who Egilman was already working with on a Zyprexa-Lilly exposé.

Gottstein seized the opportunity. Selecting a case in which the documents were relevant, Gottstein subpoenaed them. He then sent the documents to Berenson, and on December 17, 2006, the Times published Berenson’s story “Eli Lilly Said to Play Down Risk of Top Pill” on the front page. It opened with: “The drug maker Eli Lilly has engaged in a decade-long effort to play down the health risks of Zyprexa, its best-selling medication for schizophrenia, according to hundreds of internal Lilly documents and e-mail messages among top company managers.”

Berenson reported how Gottstein had provided the Times with Lilly documents showing that “Lilly executives kept important information from doctors about Zyprexa’s links to obesity and its tendency to raise blood sugar—both known risk factors for diabetes,” and that Lilly had told its sales representatives to play down these adverse effects in their conversations with doctors.

Shortly later, the Times ran another front-page story: “Drug Files Show Maker Promoted Unapproved Use,” which reported on another Lilly transgression: “Eli Lilly encouraged primary care physicians to use Zyprexa, a powerful drug for schizophrenia and bipolar disorder, in patients who did not have either condition, according to internal Lilly marketing materials.”

In a Lilly sales campaign called “Viva Zyprexa,” its sales representatives suggested to doctors that they prescribe Zyprexa to older patients with dementia, despite the fact that Zyprexa was unapproved for the treatment of dementia and carried a prominent FDA warning that it increases the risk of death in patients with dementia-related psychosis. While U.S. physicians are allowed to prescribe a drug for uses unapproved by the FDA (called “off-label prescribing”), it is illegal for drug companies to market drugs for unapproved uses.

With these Times stories, Gottstein had achieved his goal of getting truths about Zyprexa and Lilly out to the public. However, Lilly would strike back at him. The U.S. legal system allowed for Lilly—which had suppressed severe adverse effects of Zyprexa and orchestrated its illegal marketing—to threaten Gottstein with criminal contempt.

When Lilly won a Federal Court ruling that Gottstein had conspired to steal the confidential Lilly documents, Gottstein found himself in an expensive legal battle to survive Lilly’s threats to pursue criminal contempt charges against him. The cost for Gottstein to defend himself against Lilly’s assault was nearly $300,000 in legal fees. Perhaps even more costly for Gottstein has been the negative impact on his professional reputation, owing to the Court’s labeling him as “co-conspirator” in violating a protective order.

Gottstein’s only goal had been to get truths out to the public about Zyprexa and Lilly, as financial compensation was never in the picture for him. His rewards have consisted of the gratitude from current and former psychiatric patients, who appreciate his efforts at revealing truths about Lilly and Zyprexa; and satisfaction in helping initiate the Times story which pushed the Department of Justice to prosecute a suit against Lilly for their criminal marketing of Zyprexa, a suit which Lilly pleaded guilty to on January 15, 2009, settling the case with the DOJ for $1.4 billion.

Considering the fact that Zyprexa grossed over $60 billion for Lilly by 2017, Lilly’s $1.4 billion settlement with DOJ was, essentially, simply a cost of doing business. And nine Lilly sales representatives also came out ahead, establishing themselves as “whistleblowers” by filing “qui tam” lawsuits against Lilly, and as such entitled to divide among themselves almost $79 million. While many in the general public see Gottstein as a whistleblower, he was not considered as such by the legal system (and those well-rewarded sales representative whistleblowers and their lawyers ignored requests to help Gottstein with his legal fees).

The Zyprexa Papers is not simply about the harm done by blockbuster psychiatric drugs and drug company illegal marketing. It is also about the perversion of the U.S. legal system, as Gottstein illuminates the courts’ use of secrecy orders in settlement agreements to the detriment of the public. Gottstein concludes:

“When lawyers are faced with companies telling them they won’t settle unless everything is kept secret, the lawyers almost always advise (insist) their clients agree. . . .This is a situation where the benefits accrue to one group and the detriments to another. In other words, their clients are not harmed by keeping the information secret, but the public is harmed. Their clients only get benefits, i.e., money. This is also true of the lawyers, who get paid (a lot) if the case is settled but don’t get paid if they lose. The judges are supposed to allow the secrecy only if it is in the public interest, but in practice, they don’t. The secrecy greases the wheels of settlement as well as litigation, and judges want to have cases resolved and off their docket. So the incentives are all pushing towards keeping things secret. Normally, no one is representing the public interest.”

Why was Gottstein an exception? He had a connection to those people he was trying to help, recounting: “I personally got caught up in the mental health system in 1982 when, at the age of twenty-nine, I had a psychotic break (went crazy) from lack of sleep and was locked up in API [Alaska Psychiatric Institute] for thirty days. I was told I would have to take mind-numbing Thorazine-like drugs for the rest of my life. When I told them I had graduated from Harvard Law School (which I had), I was considered delusional.”

Unlike many others caught in this net, Gottstein had a knife to cut loose from it. Luckily, his mother was the Executive Director of the Alaska Mental Health Association, and she steered him to a psychiatrist with common sense who told Gottstein that anyone who doesn’t get sleep can become psychotic. Gottstein had one more brief hospitalization in 1985 when, he recalls, “I didn’t act aggressively enough with sleeping pills to get sleep. Since then, I have been able to keep on top of things and was lucky not to have been made into a permanent mental patient by the mental illness system.” These experiences drew him to advocacy for people diagnosed with serious mental illness.

In 2002, Gottstein created the nonprofit Law Project for Psychiatric Rights (PsychRights). Part of its mission is “dedicated to exposing the truth about these drugs and stopping the courts from being misled into ordering people to be drugged and subjected to other brain- and body-damaging ‘treatments’ against their will.”

Gottstein is not the first attorney to take on Lilly but, unlike the victims’ attorneys in the infamous Wesbecker case, he didn’t sell out the public to pad his pocket.

In 1989, one month after Joseph Wesbecker began taking Prozac—another Lilly blockbuster psychiatric drug—he opened fire with his AK-47 at his former place of employment in Louisville, Kentucky, killing eight people and wounding twelve before taking his own life. John Cornwell covered the trial for the London Sunday Times Magazine and wrote a book about it, The Power to Harm, which delves into Lilly’s power to corrupt a judicial system.

Wesbecker’s victims sued Lilly, claiming that Prozac had pushed Wesbecker over the edge. While Lilly had been quietly settling many Prozac violence suits, Lilly was looking for a showcase trial that it could win, and it believed that Wesbecker’s history was such that Prozac would not be seen as the cause of his mayhem, and so Lilly did not settle. In the 1994 trial, a crucial component of the strategy of victims’ attorneys was for the jury to hear about Lilly’s history of reckless disregard. Thus, victims’ attorneys wanted the jury to hear about a previous Lilly product, Oraflex, an anti-inflamatory drug introduced in 1982 but taken off the market three months later. Oraflex had been linked to the deaths of more than one hundred patients, and the DOJ had concluded that Lilly had misled the FDA (Lilly was charged with 25 counts related to mislabeling side effects and plead guilty).

In the Westbecker trial, Lilly attorneys argued that Oraflex information would be prejudicial, and Judge John Potter initially agreed that the jury shouldn’t hear it. But when Lilly attorneys used witnesses to make a case for Lilly’s superb system of collecting and analyzing side effects, Potter said that Lilly itself had opened the door to evidence to the contrary, and he ruled that Oraflex information would now be permitted. To Potter’s amazement, victims’ attorneys never presented the Oraflex evidence, and Lilly won the case.

Potter smelled a rat, believing that Lilly’s victory was a sham and that a secret settlement had been reached. But when Potter requested an investigation, the Louisville Courier Journal reported, “Lilly publicly trashed Potter and his investigation and won an order from the Kentucky Court of Appeals blocking it.” Potter appealed to the state Supreme Court, winning in 1996. Then, as the Courier Journal reported, Potter “set a hearing at which he intended to require attorneys for both sides to testify under oath. Lilly accused him of conducting a vendetta, and he recused himself. . . .The judge who inherited the case let the matter drop, and Potter’s questions were never answered.” However, in 2019, the Courier Journal reported: “Two of the victims recently told the Courier Journal that the payment totaled $20 million, worth about $41 million in today’s dollars, which the plaintiffs divided among themselves after paying their attorneys.”

We can see in the both the Prozac and Zyprexa cases why Gottstein concludes that the incentives of both money and expediency are all pushing towards keeping vital truth secret. Without exceptional judges and attorneys, the rights of the public routinely are neglected.

Bruce E. Levine, a practicing clinical psychologist, writes and speaks about how society, culture, politics, and psychology intersect. His most recent book is A Profession Without Reason: The Crisis of Contemporary Psychiatry—Untangled and Solved by Spinoza, Freethinking, and Radical Enlightenment (2022). His Web site is