Introduction

Pharmaceutical companies and drug manufacturers engage in the business of bettering human existence and remedying disease and disorder.[1] While the pharmaceutical industry is fraught with controversy, the heart of the industry revolves around the research and development of new drugs to treat all of life’s ailments and infirmities.[2] Gilead Life Sciences has been at the forefront of human immunodeficiency virus (HIV) treatment research for over thirty-five years and developed twelve groundbreaking treatments for the incurable disease.[3] In 2001, Gilead Life Sciences developed and marketed a groundbreaking HIV treatment, tenofovir disoproxil fumarate (TDF), which carried a risk for kidney disease and osteopenia.[4] While developing TDF, Gilead discovered tenofovir alafenamide fumarate (TAF), a second viable treatment that early research showed carried less risk but opted to delay full development until a later date.[5] A group of plaintiffs, users of TDF, sued for negligence, alleging that Gilead failed to develop TAF when it was discovered, and for fraudulent concealment of information regarding the safer drug, seeking damages after suffering from the bone and kidney disease associated with TDF.[6]

The plaintiffs did not allege that TDF was defective or that there was a failure to warn of the risks TDF carries.[7] The plaintiffs instead alleged that the pharmaceutical industry is beholden to the ordinary standard of care adhered to by individuals and business owners.[8] However, due to the inherent danger and risks of the field, the pharmaceutical industry is widely accepted by courts to follow augmented standards when it comes to negligence and product liability.[9] The plaintiffs sought to minimize delays in the introduction of new medical advancements, and the court agreed, imposing an exceptional obligation on the pharmaceutical industry to do so: a duty to release all their developed drugs and treatments to market the moment they are approved by the Food and Drug Administration (FDA).[10] The Court of Appeals of California’s ruling made Gilead liable for failing to research TAF upon its initial discovery and for failure to release TAF once it received Phase 3 approval from the FDA.[11] Such a burden oversteps the bounds of traditional negligence liability and imposes an affirmative duty on pharmaceutical companies to release any new product, not according to their business acumen, but on a timeline required by the court.[12]

To impose a duty on drug manufacturers and developers akin to the one imposed by the Court of Appeals of California’s ruling in the Gilead Tenofovir cases would require them to adhere to an ordinary standard of reasonable care when making business decisions and conducting market research about the release of new products.[13] Forcing a pharmaceutical company to adhere to an ordinary standard of care in an extraordinary industry, even for their business decisions, places an undue burden on the process of scientific research and discovery.[14] Furthermore, the United States Constitution grants the power to promote the progress of science to Congress, not to the judiciary, by granting inventors exclusive rights to discoveries.[15] The duty established by the court in the Gilead Cases directly impedes the exclusive rights granted by patents and is, in effect, legislating from the bench.[16] Therefore, the Court of Appeals opinion should be reversed; if such a duty is to be imposed on the highly regulated industry, it ought to come through congressional legislation or agency regulation stemming from a congressional mandate.[17]

Part I of this Note describes the systemic FDA regulation of the pharmaceutical industry and control of the industry exercised through congressional legislation.[18] Part II outlines California tort law as applied to Gilead Life Sciences and pertinent pharmaceutical ethics scholarship.[19] Part III details the basics of Gilead HIV research and development and the procedural history of the Gilead Tenofovir Cases.[20] Part IV analyzes the duties owed by pharmaceutical companies and proposes limits and considerations to those duties.[21]

I. Government Control of the Pharmaceutical Industry

Pharmaceutical law in the U.S. is based on the language of the Constitution and continuously changed through legislative and administrative revisions.[22] Article I, Section 8 grants Congress authority to promote scientific progress by protecting inventors’ rights.[23] Congress exercised this power in the pharmaceutical field by establishing the FDA.[24] Established in 1906 and empowered by the 1938 Food, Drug, and Cosmetic Act (FDCA), the FDA oversees drug development through mechanisms like the New Drug Application (NDA).[25] Subsequent amendments, including the 1962 Kefauver–Harris amendments requiring proof of safety and efficacy, and the 1984 Hatch–Waxman Act facilitating generic approvals, expanded its scope.[26] Today, this framework forms a complex system designed to safeguard the public from unsafe or ineffective drugs.[27]

Pharmaceutical policy in the U.S. centers on three goals: safety, progress, and access.[28] The FDA regulates drugs to ensure safety, while the United States Patent and Trademark Office (USPTO) grants patents to encourage scientific innovation by offering certain benefits to patent holders.[29] Holding a patent issued by the USPTO grants the right to exclude others from making, using, or selling a discovery or invention developed by the patent holder for a limited time.[30] The patent system is intended to create a financial market and, therefore, a financial incentive for scientific progress.[31] Access is largely managed by the open market, with safeguards from Congress, the World Trade Organization, and other regulators through measures like drug distribution rules and advertising restrictions.[32] Together, these systems strike a balance between regulation and incentive.[33] Without them, the industry would falter, and the government would be forced to fill the pharmaceutical gap.[34]

A. FDA Regulation of the Pharmaceutical Market and Approval Process of New Drugs

The FDA is a federal agency under the Department of Health and Human Services that regulates the pharmaceutical industry as well as other industries and supports researchers to promote progress in the industry.[35] The FDA was granted a large portion of its regulatory power by Congress in 1938 with the passage of the FDCA; however, these regulatory powers have been expanded through numerous amendments to the FDCA and other legislation.[36] The agency’s goal is to ensure the safety and effectiveness of medicines, biologics, and medical devices.[37] It accomplishes this goal through extensive regulatory frameworks that dictate the research, development, and marketing of pharmaceutical products through efficacy and risk analyses, controlled studies, and labeling requirements.[38]

1. FDA Approval Baseline Requirements

FDA approval is required for any new drug to be marketed as a medication.[39] FDA approval means that the effects of the drug have been reviewed by a body within the FDA, the Center for Drug Evaluation and Research (CDER), and the benefits of the drug are greater than any known or potential risks.[40] CDER reviews are comprehensive and conducted by physicians, statisticians, chemists, and pharmacologists, among other experts, to determine if the benefits are worth the tolerance of risks associated with the use of the drug.[41] CDER also evaluates the targeted condition, as the existence of available treatments and the severity of the target condition can tip the scales in a risk-benefit analysis.[4 2] If the target condition is a severe, life-threatening disease with no available treatments, there is more tolerance of risks.[43] In general, a new drug must be worth whatever risks it poses to be approved by the FDA and allowed to go to market.[44]

CDER similarly evaluates risk management strategies, such as warning labels detailing the risks and how to recognize any adverse effects on patients.[45] In some cases, the utility of a drug is great enough to outweigh even the most extreme of risks, such as in the case of a breakthrough therapy for a condition with no currently available treatment.[46] Extreme risks, however, may require the pharmaceutical company to create a Risk Evaluation and Mitigation Strategy (REMS) in order to achieve FDA approval.[47] REMSs are not meant to eliminate all risks but to manage serious risks by supporting prescribers and users in reducing the severity and frequency of events.[48] REMS interventions may include increased communication with patients and prescribers or requiring elements to ensure safe use.[49] For example, the FDA may dictate that only specifically licensed providers may supply the risky drug or that the drug only be administered in a healthcare facility capable of addressing potential side effects.[50] However, if the possibility of serious risk associated with a drug is high but still outweighed by its usefulness, the FDA may still approve it for use but require safeguards to be put in place by the manufacturer.[51]

2. FDA Approval Process

The FDA approval process is designed to be lengthy and thorough.[52] There are some exceptions to the rule, such as in cases of breakthrough therapies for unmet medical needs, but the typical approval process takes around ten months.[53] Very few drugs make it through the whole process; in fact, most developed drugs never advance past animal testing periods and into human clinical trials.[54] Additionally, developed drugs may fail in treating their intended conditions, but the developer may restart the process if it is later discovered to have unintended benefits for other conditions.[55] The process is so rigorous that less than 20% of drug discoveries achieve FDA approval.[56]

The first step of the approval process is Investigational New Drug Applications, which show the preclinical animal testing results and proposed human testing processes.[57] Human clinical trials may begin only after the FDA and a local institutional review board approve them.[58] There are extensive requirements for human clinical trials to be approved, and they are broken down into three phases.[59] The three phases are differentiated by the type of subject and dosage: healthy volunteers, small populations with specific diseases or conditions, and larger populations with different dosages.[60] A clinical study cannot move to the next phase without showing effectiveness and general safety during the previous study phase.[61] Once the clinical study is complete, a new drug application with documentation of a drug’s efficacy is filed, and the application is reviewed by the FDA.[62] If the final application demonstrates the drug is an effective treatment for the targeted condition with an acceptable level of risk, the application is approved and the drug may be released to market.[63]

The risk evaluation process does not stop upon receipt of an FDA approval letter; drug manufacturers must continue researching to uncover any potential risks or hazards after the drug is released to market.[64] If post-marketing studies reveal that the risk-benefit analysis conducted in the approval process is no longer adequate or that a significant hazard is discovered, the FDA has numerous avenues to address the concern.[65] In the case of inadequate risk-benefit analysis, the FDA can send warning letters, label changes, urge a recall, or withdraw approval entirely.[66] In the case of new knowledge of significant hazards, the FDA requires the manufacturer to revise its label to include the hazard as soon as there is reasonable evidence of the hazard’s link to the drug.[67]

3. FDA Approved Labeling

As part of its risk management framework, the FDA requires that all labels and warnings associated with approved drugs also have approved content and formatting.[68] The exact text and language of the label are subject to review to weigh whether the label is an adequate warning for consumers.[69] An adequate warning for a medication includes contraindications (situations where a drug should not be used due to abnormal levels of risk that outweigh the benefits, such as concurrent medication usage or comorbidity), notices (serious risks that are known to occur), and precautions (risks that are less common or serious).[70] If there is a risk of death or serious injury, the drug is required to have a prominent box warning of the risks associated with use.[71]

The FDA also mandates that warning labels be uniform across the industry, regulating not only the content of labels but the format and order of information as well.[72] Any changes to a label after marketing and continuing research of the drug must be approved by the FDA.[73] The uniformity of warning labels is meant to make it easier to understand the risks associated with the use of the drug, both for the prescriber and for the patient.[74] There are different requirements for prescriber warnings and patient warnings, namely that the prescriber warnings contain more scientific information and technical statements.[75] The warnings that come with any new drug are drafted with specificity and uniformity to bridge the knowledge gap between the numerous stakeholders of the pharmaceutical industry.[76]

B. United States Patent and Trademark Office and the Bayh–Dole Act

The pharmaceutical industry, while strictly regulated by the FDA, enjoys the benefits of patent protections to control its discoveries and its use.[77] The USPTO exists thanks to the Intellectual Property Clause of the Constitution.[78] The system of patent ownership and the associated rights have been in place since the early days of the United States, with the passage of the Patent Act of 1790.[79] The patent holder for a discovery or invention has the right to exclude others from making, using, or selling the discovery or invention in the U.S. for twenty years.[80] In the pharmaceutical industry, the patents for discoveries are often held by the inventor’s employer, provided that the discovery was made by an employee in the normal course of their employment.[81] In other words, while a patent does not necessarily confer on an owner the commercial rights to the product in itself, it does prevent others from marketing the product without the owner’s consent for the term of the patent.[82] After the patent expires, the invention or discovery enters the public domain, where the owner no longer has control over who can make, use, or sell their invention or discovery.[83]

The USPTO emphasizes the necessity of protection for new ideas, innovation, and creativity for the U.S. economy.[84] Allowing owners to control the rights to their inventions promotes scientific research and development by creating a financial market for the use of protected inventions and discoveries.[85] Without a market for consensual exchange between patent owners and consumers, scientific progress would falter because there would be no incentive to research and develop new solutions to the world’s problems.[86] Patents are such a lucrative commodity that there are entities that operate solely to assert patent rights for inventions and discoveries they had no part in creating in order to profit from licensing agreements with pharmaceutical giants.[87] The profitability of scientific innovation stems from the ability to dictate the details of the invention’s entry into the open market, and the reality of scientific innovation, in turn, stems from its profitability in a capitalistic society.[88]

One exception to the absolute control granted by a patent is the set of rights granted to the federal government under the Patent and Trademark Law Amendments Act, or Bayh–Dole Act, of 1980.[89] Under the Bayh–Dole Act, inventions and discoveries made by entities or individuals funded by a federal agency are licensed partially to the funding agency, giving it some permission to act as the owner of the patent.[90] It is important to note that the ownership of the invention or discovery still vests in the patent owner first, regardless of the agency’s license.[91] Most controversially, the Bayh–Dole Act grants the federal agencies march-in rights.[92] March-in rights allow the funding federal agency to require the patent owner to grant a license to a responsible applicant and give the applicant permission to use, market, and distribute the patented development as if they were the developer.[93]

That is not to say the federal government or the license granted divests the inventor or developer of their patent or ownership rights but march-in rights do allow the federal agency to take action when the patent holder would not.[94] March-in rights may only be exercised when, after an investigation, the federal agency determines: 1) action is necessary because the inventor or developer has not taken, or is not expected to take, steps to apply the subject invention in the field of the applicant; 2) action is necessary due to health or safety needs that have not been reasonably satisfied by the inventor or developer; 3) action is necessary because federal requirements for public use have not been reasonably satisfied by the inventor or developer; or 4) action is necessary because the inventor, developer, or their licensee is not adhering to the requirements to substantially manufacture the invention in the United States.[95]

Even when one of those conditions is satisfied, federal agencies are often reticent to exercise their march-in rights; in fact, since Bayh–Dole’s enactment, no federal agency has exercised its march-in rights.[96] The National Institute of Standards and Technology (NIST) has proposed new inclusions to the rule regarding enforcement of the Bayh–Dole Act and the exercise of march-in rights that would take pricing into account, allowing the agency to grant licenses where the price of a drug is considered to be extreme.[97] The pricing provisions were ultimately not included in the updated rule after 81,000 comments were received during the Notice and Comment Period of the Rulemaking process.[98] Regardless of governmental reluctance to exercise the right, the license granted by the Bayh–Dole Act permits federal agencies to control some aspects of a patented development without the permission of the patent holder.[99] The Bayh–Dole Act can provide a method for the government to address the concerns of pharmaceutical profit maximization without overextending other fields of law, which would have extremely broad effects on scientific innovation and discovery.[100]

II. Tort Law and Other Considerations in the Pharmaceutical Industry

Tort liability is meant to align the liability of harm caused to the responsible party and to make victims whole.[101] In the realm of negligent torts, a manufacturer is subject to traditional negligence liability and product liability.[102] The pharmaceutical industry is unique, however, because the majority of the obligations imposed by traditional tort law are addressed within the regulatory scheme of the FDA, such as product defects and adequate consumer warnings.[103] This is not to say that pharmaceutical companies are exempt from all tort liability due to the FDA’s strict regulation of the industry, but rather that claims brought by victims of pharmaceutical negligence often must also show that the pharmaceutical company acted contrary to regulatory requirements.[104] Furthermore, beyond the realm of tort law, there are numerous ethical minefields that pharmaceutical companies must navigate before, during, and after marketing a product.[105]

A. Duties Imposed by Tort Law

Tort liability is meant to align the civil liability of harm caused to the responsible party.[106] In cases of negligent torts, manufacturers may face both traditional negligence liability and product liability actions for their conduct.[107] Negligence requires plaintiffs to prove four elements with a preponderance of evidence to hold an alleged tortfeasor liable.[108] Product liability is slightly different, namely, eliminating the need for some elements required in negligence claims.[1 0 9] While there often is strict liability for product defects, the plaintiff must demonstrate the existence of an actual product defect in manufacturing, design, or warning to be awarded a remedy.[110] Even with the elimination of some negligence elements, strict product liability is not inherently an easier standard for plaintiffs to meet.[111]

1. Negligence

Negligence requires a plaintiff to establish the following: duty, breach, causation, and damages.[112] A person or entity typically has a duty to exercise reasonable care when their actions or conduct create the risk of physical harm.[113] Where there is a duty imposed, the normal standard of care requires the bound party to exercise a reasonable—not the highest possible—level of care in handling any possible risks or hazards that occur.[114] Negligence doctrine also typically only applies to scenarios involving reasonably foreseeable risks or hazards and where there is a relationship between the plaintiff and defendant.[115] There are certain classes of cases where a greater principle or policy justifies denying or limiting liability.[116] This presents a question of law for a court to decide whether a defendant owes a limited, or even no, duty of reasonable care.[117]

Applying negligence to nonfeasance, a failure to act, rather than misfeasance, acting improperly, places an affirmative duty on the alleged tortfeasor.[118] In general, affirmative duties are only in place for certain relationships or instances.[119] Examples of affirmative duties courts have imposed include: a person must exercise reasonable care to complete a rescue they voluntarily undertook; an entity must act reasonably to minimize harm if it causes the harm or controls the instrumentality of harm; businesses must act reasonably to protect their helpless customers; bosses must act reasonably to protect their helpless employees; or a parent must act reasonably to protect their child.[120] In defining tort duties, the reasonableness standard balances what a reasonable person in the scenario would have done with what is feasible in the situation.[121]

Beyond the ephemeral concept of duty, the victim of a tort must show breach, causation, and damages.[122] A breach is defined as any action contrary to the imposed duty.[123] There must also be a causal link between the breach of the imposed duty by the tortfeasor and the harm that was suffered by the victim.[124] Finally, the victim must be able to show damages; in other words, the victim must show that the court is able to provide a remedy for the harm they suffered.[125] Only if all four elements of negligence are proven may the alleged tortfeasor be held liable for the harm to the victims.[126]

2. Product Liability

Product liability is imposed on suppliers of goods or products for the various kinds of losses of purchasers, users, and bystanders resulting from defects in those products.[127] A product includes any tangible property or thing distributed commercially for use or consumption by a producer.[128] While there often is strict liability for product defects, the plaintiff must demonstrate the existence of an actual product defect in manufacturing, design, or warning to be awarded a remedy.[129] Strict liability for product defects was established by common law and occasionally by statute because manufacturers should bear the cost of injuries resulting from their own defective products.[130] Design and warning defects are the most common allegations within the pharmaceutical industry.[131]

Courts often use the risk-utility test as the primary test in strict liability for product defects.[132] The risk-utility test is a cost-benefit type balancing examination, where a plaintiff needs to show that the product is so unreasonably dangerous that the level of risk associated with the defendant's chosen design is far greater than the level of utility when compared to an alternative design.[133] Where the plaintiff can show that the risk of the product could have been mitigated by an alternative design or warning while maintaining the utility and feasibility, there are grounds for strict product liability.[134]

Furthermore, some product designs may be unreasonably dangerous without a proper warning either placed on the product or otherwise communicated.[135] Warnings should be oriented towards the possible consumers of a product; if a consumer of a product is unable to comprehend, internalize, and act in accordance with the warning, then it is insufficient as a cautionary mechanism.[136] The nonexistence or inadequacy of such a warning can give rise to liability for the manufacturer or seller of the product.[137]

B. Exceptions for the Pharmaceutical Industry

The pharmaceutical industry enjoys numerous exceptions to traditional tort law because of the broad federal regulation of typical tort causes of action.[138] The exceptions include caveats for the unavoidably unsafe nature of the industry and workarounds for failure-to-warn pitfalls.[139] Plaintiffs who bring actions against a pharmaceutical company often face hurdles not present in traditional tort law when navigating the federal regulatory labyrinths to establish a cause of action.[140] The extensive regulatory framework of the FDA and congressional action addresses a majority of the elements necessary to prove negligence or product liability; therefore, claims brought by victims of pharmaceutical negligence often must also show that the pharmaceutical company acted contrary to regulatory requirements.[141]

1. Unavoidably Unsafe

Courts previously classified the pharmaceutical industry as unavoidably unsafe.[142] Judges typically recognize that some level of risk to consumers is inevitable, even under the strictest safety protocols.[143] Unlike other markets and products, medications and drugs cannot be made entirely risk-free without diminishing or eliminating their intended therapeutic effect.[144] Medications almost always carry side effects, contraindications, or risks that vary depending on dosage, individual physiology, or interactions with other substances.[145] However, these risks do not mean the product is defective so long as it is properly manufactured and accompanied by adequate warnings.[146] In this sense, the classification acknowledges that the benefits of drug therapies often outweigh their inherent dangers, provided those dangers are transparently, prominently, and proactively communicated to prescribers and patients.[147]

What distinguishes pharmaceuticals from most other product categories is the significant and undeniable role of the FDA as a regulator.[148] Before a drug can enter the market, the FDA engages in a rigorous risk-utility analysis, requiring manufacturers to demonstrate both safety and efficacy through numerous clinical trials and supporting data.[149] By granting approval, the FDA signals that the therapeutic utility of the drug outweighs its potential risks, at least within the studied and approved parameters of use.[150] This process incorporates the balancing test that courts would otherwise apply in product liability cases involving design defects.[151]

Courts typically respect the FDA’s scientific evaluation, which includes an assessment of a drug’s risks and benefits, creating difficulties for plaintiffs bringing defect claims against pharmaceutical manufacturers.[152] Claims based on design are less common, and litigation more frequently focuses on other areas of potential liability, such as manufacturing defects in individual products or inadequate warnings.[153] In this context, FDA approval serves not only as a scientific determination but also as a factor that shapes the scope of legal responsibility and liability for pharmaceutical companies.[154]

2. Failure to Warn Exceptions

Failure-to-warn allegations, allegations that a defendant pharmaceutical manufacturer failed to warn plaintiffs of a danger that subsequently caused them harm, are generally obviated due to the FDA’s strict regulation of warning labels, which are meant to limit the occurrence of warning defect liability on pharmaceutical companies.[155] The FDA dictates the content and format of all warning labels in the pharmaceutical industry, creating a uniform standard across the entire industry.[156] The uniformity assists physicians, intermediaries, and consumers in understanding the best ways to prescribe and administer the drug to maximize effectiveness and minimize possible risks.[157] Furthermore, newly discovered risks and hazards must be reported to the FDA as soon as there is reasonable evidence of the connection to the drug.[158] In light of newly discovered hazards, the FDA requires an updated warning label.[1 5 9] Therefore, failure-to-warn liability against manufacturers typically only applies where the plaintiff can prove that the manufacturer failed to maintain adequate warning labels and communication with the FDA in light of newly acquired information regarding risks and hazards.[160]

The learned intermediary doctrine allows pharmaceutical companies and manufacturers to warn the physician who prescribes their product, not the user or the consumer, of the risks associated with its use.[161] It is the pharmaceutical company’s duty to provide accurate warning labels to the physicians, but the physicians’ duty to communicate those warnings effectively to their patients.[162] The rationale behind the doctrine is that physicians are in a better place to communicate the risks to their patients on a more personal, understandable level to allow their patients to make informed choices about whether to proceed with the medication.[163] If the pharmaceutical manufacturer has provided sufficient warnings, which are regulated and dictated by the FDA, to the prescriber, then patients only have a failure-to-warn claim against the prescriber.[164] Therefore, once again, the cause of action against the manufacturer of the drug is largely precluded.[165]

C. Pharmaceutical Ethics

As with all businesses and industries, there are norms, rules, and customs that govern the behavior and actions of the pharmaceutical industry.[166] Most of these rules come from within the industry or within the company itself, with a minority coming from outside the industry to regulate how the industry interacts with its external stakeholders.[167] The ethical rules of the pharmaceutical industry are much like those of any other industry, but the stakes are considerably higher.[168] Tort law and ethics are often tied together in the pharmaceutical industry because of the moral concept that a person or entity should not cause harm to another person or entity without liability.[169] Businesses often adopt specific ethical codes within the bounds of government regulation and legislation of the applicable industry.[170] Gilead Life Sciences, for example, adopted a comprehensive set of rules for its employees and executives relating to how they conduct their research and interactions with the public.[171]

When the government wants to insert an ethical or moral standard into an industry, it often does so through legislation or regulation addressing the relevant behavior.[172] Litigation is extremely costly to pharmaceutical companies, both in financial and reputational terms, making it in their best interest to establish an ethical code dictating employee conduct and research requirements.[173] There are also external factors that weigh on any producer of goods, regardless of the industry, such as market fluctuations and consumer expectations.[174] There will always be a need for new treatment options for existing and undiscovered conditions, and the public sector is not suited to bear the entire burden of such large-scale research and development.[175] Therefore, the pharmaceutical industry faces numerous internal and external pressures to operate within the bounds of governed behavior and satisfy the goals of the industry.[176]

III. Foundation of the Gilead Tenofovir Cases

Gilead Life Sciences is at the forefront of HIV research and has patented numerous groundbreaking treatments for the deadly disease.[177] In 2024, Gilead was sued in a class action, with over 24,000 plaintiffs, for negligence and fraudulent concealment in the State of California.[178] The negligence claim stemmed from failure to develop and release TAF in a timely manner to reduce the risk of adverse effects from TDF, whereas the fraudulent concealment claim alleged that Gilead wrongfully concealed the information regarding TAF from the public.[17 9 ] The case has been kicked back and forth between the trial and appellate level courts numerous times.[180] In the latest ruling, the California Court of Appeals ruled against the pharmaceutical giant, obligating them to adhere to an ordinary standard of care beyond a duty of reasonable care in product marketing, that is, not putting a defective product to market.[181]

A. Gilead’s HIV Research and Treatments

Gilead Life Sciences currently has twelve HIV medications on the market, nine of which contain a tenofovir derivative.[182] Gilead Sciences developed TDF to treat HIV, and in the development process of TDF, they discovered TAF, which could also treat HIV, but delayed its development by focusing on TDF.[183] Tenofovir itself is a prodrug—an unstable drug that often needs to be combined with another chemical to be safe and effective.[184] Pure tenofovir causes rapid kidney failure because of its instability; TDF and TAF are prodrugs of tenofovir, stabilizing the medication sufficiently to be safe and effective for human use.[185] This is not to say TDF, TAF, or other prodrugs are free from risk.[186] In the case of TDF and TAF, the prodrug formula simply stabilizes tenofovir enough to pass FDA muster in treating the target condition without untenable risks.[187]

Both drugs create a high level of the therapeutic form of tenofovir, tenofovir diphosphate.[188] However, TDF results in slightly higher concentrations of pure tenofovir and higher resultant risks associated with pure tenofovir in a patient’s plasma than TAF.[189] TDF carries the risk of osteopenia and kidney disease due to Fanconi syndrome.[190] Osteopenia is defined as low bone mass or density as well as overall softening of the bone, leading to an increase in fractures.[191] Fanconi syndrome is an acquired kidney disorder that impairs the reabsorption of nutrients from the kidney into the bloodstream.[192] Other than its obvious benefits in treating the target condition, HIV, TDF also has the unintended benefit of lowering a patient’s cholesterol and triglycerides, and switching to other HIV treatments has been observed to raise cholesterol and triglycerides and lead to weight gain.[193] TAF does not carry these unintended cardiovascular benefits of TDF and poses the same risks of kidney disease and osteopenia, though at a lower rate.[194] The difference in general safety, tolerability, and efficacy between the two tenofovir prodrugs, however, is negligible.[195]

B. Procedural History

Gilead Life Sciences was sued in several class actions in 2018 for alleged negligence, strict product liability, breach of express and implied warranties, and fraudulent concealment after plaintiffs suffered from the known side effects of TDF.[196] Through the iterations, the complaint was whittled down to negligently failing to research and release TAF in light of TDF’s risks and fraudulent concealment of information regarding TAF.[197] Defendant Gilead Sciences moved for summary judgment, arguing the plaintiffs failed to allege a product defect and that Gilead had no duty to disclose information and trade secrets about unreleased drugs.[198] The trial court denied the defendant’s motion for summary judgment, writing that the plaintiffs had alleged enough to create a genuine issue of material fact; the defendant appealed this decision.[199] The Court of Appeal of California reversed in part and affirmed in part the lower court’s dismissal of the summary judgment motion.[200] The court wrote that failure to allege a defect does not negate a negligence claim and that the company should have exercised reasonable care when researching and releasing a new drug.[201]

The court’s opinion extended the duty to exercise reasonable care, which normally applies to the outward actions taken by the defendant, to actions beyond the duty not to market a defective product.[202] The court reasoned that the duty it imposed is not an affirmative one and that it does not stem from nonfeasance but from misfeasance by holding that a failure to release the new drug is, in fact, misfeasance.[203] The newly imposed duty applies to the decisions manufacturers make after obtaining the results of phase III clinical trials of the alternative drug and would require manufacturers to release the alternative drug on a timeline levied by a court.[204] Gilead Sciences has appealed to the Supreme Court of California, and the petition has been accepted, with oral arguments expected to occur in 2025.[205]

IV. Corporate Profitability and the Role of Government Influence

Pharmaceutical companies should not owe an extended duty of reasonable care in a case such as Gilead’s.[206] A court extending the duty of care owed by pharmaceutical companies to research and development is, in effect, imposing a brand-new regulation on the industry that infringes on the rights granted by patent approval.[207] The extended duty dictates when and to whom a pharmaceutical company must permit the use of its patented discovery and when it should be offered for sale.[208] While profit maximization in a field so necessary to human health is ethically unsavory, regulations do not stem from the courts but from the applicable agency with power granted by the legislature.[209] While the Court of Appeal’s goal of limiting profit maximization is noble, extending tort duties to cover what would be an acceptable business decision in another industry creates numerous policy issues.[210] Among the issues created are the sanctity of patent rights and excessive government interference with internal decision-making that would otherwise be acceptable.[211]

A. Profit and Morals in the Pharmaceutical Industry

While tort law is largely governed by common law principles, the underlying concern in Gilead Life Sciences was profit maximization schemes and their effect on consumers.[212] Profit maximization schemes in the pharmaceutical industry are not uncommon, as the goal of any industry and corporation is to turn a profit.[213] However, a court’s power rests in the interpretation of regulation, not instituting one itself, and whether there should be a rule limiting profit maximization is a question for the FDA or the legislature to address.[214] There are solutions to profit maximization that do not involve the overextension of tort law to precariously hasten the process of innovation.[215]

Ethically, a pharmaceutical company should weigh the needs of its consumers against the desires of its shareholders to turn a large profit.[216] The control granted to patent holders and the basic economics of the free market will inevitably lead to profit maximization in industry, particularly when a company will not be removing the old drug from the market, only adding a new one.[217] The pharmaceutical industry trends towards anticompetitive practices due to the rights granted by patents, leading to steeper prices for lifesaving treatments than is ideal.[218] However, the patent holder, Gilead Life Sciences, in this case, controls the supply of the drug in the market and, therefore, controls the price of and profit it receives from the drug.[219] Releasing a new drug would alter the demand for both drugs and reduce the price in the free market, reducing profits on the old one and hindering the growth of demand for the new one.[220]

However, the primary economic consideration should not be maximizing profits but recouping the investment for research and development.[221] If ethics and morals dictated the business decisions around research and development, then the goal of the pharmaceutical industry would be to earn just enough profit to recoup its investment and to fund the next pharmaceutical discovery.[222] In order to push the industry away from its anticompetitive tendencies, the government must strive to insert society’s ethics and morals into an insulated industry.[223] When trying to influence the whole of an industry, the government would find it best to do so through legislation and regulation aimed at restricting questionable practices.[224] The government must strike a balance to limit unethical practices, like profit maximization, while encouraging the progress of science per the constitutional mandate of the Intellectual Property Clause.[225]

B. Appropriateness of the Duty Imposed by Gilead Tenofovir Cases

The Gilead Tenofovir cases are a show of concerning judicial overreach and an attempt to expand the duty of pharmaceutical companies far beyond what the law has historically required.[226] By treating Gilead’s decision to delay the release of a successor drug as actionable negligence, the court effectively transformed a valid business judgment into a brand new tort.[227] This reasoning equates a company’s decision not to accelerate development with causing actionable harm, blurring an already misunderstood line between nonfeasance and misfeasance.[228] Such an approach not only disregards the settled understanding that pharmaceuticals are unavoidably unsafe but also undermines the drug evaluation framework carefully constructed by Congress and the FDA through decades of legislation and regulation.[229]

This expansion of duty is both judicially unsound and dangerously impractical.[230] The judiciary is simply not equipped to dictate research timelines, weigh complex scientific tradeoffs, or decide when a drug should be released to market—that role belongs to the FDA under authority expressly delegated by Congress.[231] By overstepping into this domain, the judiciary risks stifling innovation, upsetting intellectual property rights, and imposing inconsistent standards that no industry could reasonably satisfy without compromising efficacy or safety.[232] If left unchecked, this instance of judicial overreach would erode the balance between profit incentives and public safety that underpins pharmaceutical law.[233]

1. Doctrinal Inconsistencies in the Court’s Reasoning

The Gilead Tenofovir Cases place a new duty on pharmaceutical companies and impose a different standard for defendants to appease consumers dissatisfied with the pace at which discoveries are made and products are put to market.[234] The cause of action places an affirmative duty on the industry where the typical instances giving rise to a duty to act are not present.[235] A pharmaceutical company does owe some affirmative duties to its customers where its product is the instrumentality causing harm; that is, it is defective.[236] However, in the case of Gilead, their product was not defective, nor was it alleged to be; it simply carried a tolerable level of risk, as did the product the plaintiffs allege is superior.[2 3 7]

Furthermore, the pharmaceutical industry is unavoidably unsafe; it is impossible to eliminate all risks associated with taking a medication.[238] While TDF carried some risk for serious side effects, the FDA determined the utility of the drug far outweighed the risk of such side effects.[239] The plaintiffs argued that the schedule on which Gilead chose to research and develop TAF was the reason for the harm they suffered.[240] The plaintiffs did not allege that Gilead failed to comply with the continuing research requirements of the FDA or that the product was defective.[241] In holding that Gilead owed a duty to exercise reasonable care when deciding the schedule in which a drug is researched and developed, it equated Gilead’s reasonable declination to act on their discovery with acting in a way that caused explicit harm and characterized declination as misfeasance, rather than nonfeasance.[242]

Likewise, the heavy regulation of the field forestalls a large portion of traditional tort claims against a pharmaceutical company.[243] The FDCA grants the power to regulate food, drugs, and cosmetics to the federal government, in particular to the FDA; states have very little room to regulate the pharmaceutical industry without running into issues of conflict preemption.[244] That is not to say that pharmaceutical companies cannot and should not be sued for the harm their products may cause, but that the cause of action for such claims is limited.[245] The Gilead Life Sciences ruling comes into conflict with the FDCA’s mandate.[246] With the level of preclusion due to federal regulation, exercising reasonable care in the pharmaceutical industry should not extend beyond the realm of product liability and exercising reasonable care to discover hidden defects and risks of a drug.[247] Therefore, the duty of reasonable care owed by pharmaceutical companies is to follow any Congressional directives and all FDA regulations and rules.[248] The court in Gilead Life Sciences claimed not to be imposing a duty to innovate on the pharmaceutical industry, but it failed to make a reasonable distinction between an ordinary duty of care and a duty to innovate in the context of pharmaceutical research, development, and marketing.[249] The new duty creates a Catch-22 for all industries, not just pharmaceuticals: it implores manufacturers to release new products once they are developed or risk being held liable for delaying, even if no direct harm was caused by the delay.[250]

2. Separation of Powers and the Boundaries of Judicial Authority

Extending the duty of reasonable care to encompass research and development decisions risks intruding into the legislative and executive domains, toeing the separation-of-powers line.[251] Under the Constitution, Congress holds the power to promote scientific progress and has delegated pharmaceutical oversight to the FDA through legislation.[252] Courts are not meant to dictate research timelines, assess complex scientific tradeoffs, or determine when a drug is market-ready.[253] By imposing new duties that effectively dictate how and when companies must innovate, courts step into the role of regulator.[254] This kind of judicial lawmaking is not only inconsistent with established principles of constitutional and administrative law but also undermines the carefully constructed regulatory framework Congress and the FDA have established.[255] Instituting an affirmative duty to exercise reasonable care when making what amounts to a business decision about research and development of a discovery impinges on the Intellectual Property Clause and disincentivizes innovation by curbing the intellectual property rights granted to the holder of a federal patent.[256]

Congressional power to promote scientific progress is not limited to the pharmaceutical industry.[257] The pharmaceutical industry is not the only field where products remain unavoidably unsafe despite rigorous regulation.[258] Yet courts do not impose affirmative duties on manufacturers in those industries to accelerate innovation or introduce safer products more quickly, and if a court attempted to do so, there would likely be a large public uproar to keep such responsibilities in the hands of the industry experts.[259] For a court to overstep its power and impose such a duty uniquely on pharmaceutical companies introduces inconsistency in tort law and places a disproportionate burden on one industry, despite its highly regulated nature and vital public function.[260]

Instead of relying on an expansion of tort law by overzealous and overstepping courts, policymakers have a variety of tools available to limit anticompetitive profit strategies while encouraging innovation.[261] For instance, Congress could alter patent exclusivity periods to curb sitting on patents without diminishing incentives for genuine innovation.[262] Additionally, Congress could expand federal funding for comparative effectiveness research to encourage transparency in treatment options.[263] Antitrust enforcement through the Federal Trade Commission and Department of Justice could also address collusive or exclusionary practices directly, targeting anticompetitive behavior without distorting the tort system.[264] Appropriate use of these alternatives by the proper bodies ensures that the balance between profit maximization and public health is struck by institutions with the proper authority and expertise.[265]

3. Existing Agency Prerogative to Exercise March-in Rights

The Bayh–Dole Act, a policy already on the books, can be the key to the limitation of profit maximization in the pharmaceutical industry without implementing further policy solutions that may prove difficult to enact.[266] The Bayh–Dole Act allows the federal government to intervene, in limited circumstances, where a pharmaceutical company may be delaying development to increase profits if the company accepts federal funds or resources in the process.[267] Most pharmaceutical developments in the modern age were created using federal resources and, therefore, are subject to the terms of the Bayh–Dole Act.[268] It is important to note that anyone can insist on the exercise of march-in rights by an agency that funded the development of the discovery, however infrequently those urgings are acted upon.[269] The National Institute of Standards and Technology (NIST) has proposed new inclusions to the rule regarding enforcement of the Bayh–Dole Act and the exercise of march-in rights that would take pricing into account.[270] The pricing provisions were ultimately not included in the updated rule after 81,000 comments were received during the Notice and Comment Period of the Rulemaking process.[271] However, the failed addition to the rule does not need to be the end of inclusion of pricing provisions in the Bayh–Dole Act or the adoption of a pharmaceutical profit-limiting system.[272]

As such, any amendment to the reasons an agency may exercise march-in rights would likely need to come from a Congressional amendment to the Act.[273] Congress should amend the Bayh–Dole Act in a way that explicitly requires the consideration of price in march-in investigations.[274] It is important to note that including things such as price and timelines in march-in right determinations may impact the incentivization of innovation and pricing as a whole for patented products.[275] There may also be a trend away from public-private partnerships, which make up a majority of the pharmaceutical industry with such changes.[276] Simply put, if there is a risk of government intervention over the pricing of pharmaceutical innovations created through the use of government funding, developers may be less inclined to receive such funding, and consumers will be left to the will of the industry with no recourse from the Bayh–Dole Act.[277]

Conclusion

The extraordinary duty the court in the Gilead Tenofovir cases levied on the pharmaceutical industry is beyond the scope of tort liability and of judicial power itself.[278] Such a burden oversteps the bounds of traditional negligence liability and forces pharmaceutical companies to release any new product, not according to their business acumen but on a timeline required by the court, regardless of the rights to control granted to patent-holders.[279] Agency regulation or congressional legislation dictates the requirements followed by the pharmaceutical industry regarding when, how, and where they may release their products to the market.[280] Forcing a pharmaceutical company to adhere to an ordinary standard of care in an extraordinary industry, even for their business decisions, places an undue burden on the progress of scientific research and discovery.[281]

In an ideal, utopian world, the public sector would be able to satisfy the needs of the human condition and cure all infirmities; however, the reality of a capitalistic society is that the private sector is necessary to fill the large and uneven gaps.[282] Therefore, the private sector controls the pharmaceutical market, and the market dictates commercial decision-making within an individual company.[283] The ethical decision-making and morality of the pharmaceutical industry should never cease to be questioned, but in the case of Gilead and tenofovir, the most ethical decision places a burden that is too heavy to bear without greater consequences on American industry as a whole.[284]

[1] See Kanika Saxena et al., The Role of Pharmaceutical Industry in Building a Resilient Health System, Frontiers Pub. Health, Dec. 2022, at 2 (explaining the necessity of the pharmaceutical industry in public health); C. Durant, The Responsibility of the Pharmaceutical Industry, 7 Clinical Microbiology & Infection (Supplement 6) 2, 1 (2015) (“No other industry commits a higher percentage of sales to innovation and future advances. In the last year, this investment resulted in more than 40 new approved treatments targeting 36 diseases benefiting a patient population of 545 million.”); Aurora Plomer, Patents, Human Rights & Access to Science 1–13 (2015) (detailing the recent pharmaceutical advances from pharmaceutical giants that have change the detection and treatment of certain cancers).

[2] See Saxena et al., supra note 1, at 2 (elaborating on the driving principles of the pharmaceutical industry).

[3] See Selected Top HIV/AIDS Drugs Worldwide Based on Revenue in 2023, Statista, https://www.statista.com/statistics/273434/revenue-of-the-worlds-most-important-aids-drugs/ (last visited Nov. 16, 2024) (listing the most prominent HIV drugs and their manufacturer); Gilead Life Scis., Inc. v. Superior Court, 98 Cal. App. 5th 911, 917 (2024) (explaining the risks associated with the use of TDF and why plaintiffs sued).

[4] See Gilead Life Scis., Inc., 98 Cal. App. 5th at 916 (explaining the history of TDF and its risks).

[5] See id. (explaining the history of TAF development).

[6] See id. at 917 (describing the plaintiffs’ complaint in the Gilead Tenofovir Cases).

[7] See id.

[8] See id.

[9] See Brown v. Superior Court, 44 Cal. 3d 1049, 1061 (1988) (“A drug manufacturer’s liability for a defectively designed drug should not be measured by the standards of strict liability because of the public interest in the development, availability, and reasonable price of drugs . . . .”).

[10] See Gilead Life Scis., Inc., 98 Cal. App. 5th at 918 (outlining plaintiffs’ allegations against Gilead).

[11] See id. (describing the details of the plaintiffs’ complaint in the Gilead Tenofovir Cases).

[12] See Brief for International Center for Law & Economics et al. as Amici Curiae supporting Petitioner, Gilead Life Scis., Inc. v. Superior Court, 320 Cal. Rptr. 3d 454 at 6–7 (Cal. 2024) (No. S283862) (highlighting the issues and implications of the Gilead ruling).

[13] See Katia Asche et al., California Supreme Court to Review Newly Created Duty to Market a “Safer” Product Even in the Absence of a Defect, Nat. L. Rev. (May 9, 2024), https://natlawreview.com/article/california-supreme-court-review-newly-created-duty-market-safer-product-even (“[T]he court’s ruling could have the counterintuitive effect of preventing potentially life-saving drugs or safer products from being developed.”).

[14] See id. (“[T]he court is thus tasked with making what amounts to a purely business decision on behalf of companies.”).

[15] See, e.g., U.S. Const. art. I, § 8, cl. 8 (highlighting Congress’s power to promote the progress of useful arts and sciences).

[16] See Thomas L. Jipping, Legislating from the Bench: The Greatest Threat to Judicial Independence, 43 S. Tex. L. Rev. 141, 148 (2001) (“Taking the Constitution on its own terms, then, exercising ‘legislative power’ (legislating from the bench) exceeds the judiciary's authority.”).

[17] See id.

[18] See infra Part I.

[19] See infra Part II.

[20] See infra Part III.

[21] See infra Part IV.

[22] See U.S. Const. art. I, § 8, cl. 8 (granting Congress the power to promote scientific progress); Federal Food, Drug, and Cosmetic Act of 1938, 21 U.S.C. § 355 (dictating requirements for new drugs to be approved).

[23] See U.S. Const. art. I, § 8, cl. 8 (granting Congress the power “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”).

[24] The FDA is a federal agency under the U.S. Department of Health and Human Services (HHS) that regulates the pharmaceutical industry. See About FDA, FDA, https://www.fda.gov/ (last visited Nov. 16, 2024) (showing the history and goals of the FDA as a whole).

[25] See Ahmed Nahian & Roopma Wadhwa, Federal Regulation of Medication Production, StatPearls (June 2023) https://www.ncbi.nlm.nih.gov/books/NBK572098/ (describing the history of federal pharmaceutical regulation); About FDA, supra note 24 (tracing the development and overarching mission of the FDA).

[26] See Nahian & Wadhwa, supra note 25; see also Gerald J. Mossinghoff, Overview of the Hatch–Waxman Act and Its Impact on the Drug Development Process, 54 Food & Drug L.J. 187, 187 (1999) (explaining the new provisions of the Hatch–Waxman Act).

[27] See Frederick Abbott & Graham Dukes, Global Pharmaceutical Policy 3–13 (2009) (outlining why pharmaceutical policy exists).

[28] See id. (outlining issues regarding pharmaceutical policies and how to overcome them on a global scale).

[29] See id. at 3, 11–13 (explaining the roles of different stakeholders in promoting the three goals of the pharmaceutical industry).

[30] See Patent Basics, U.S. Pat. & Trademark Off., https://www.uspto.gov/patents/basics/essentials#questions (last visited Nov. 16, 2024) (explaining the basics of what patents are and the rights they grant).

[31] See id.

[32] See WTO, WHO, & WIPO, Promoting Access to Medical Technologies and Innovation 42–117 (2020) (2d ed. 2020) (describing global health policies that promote access to healthcare around the world); Philip S. Goldberg et al., A Prescription for Pharmaceutical Preemption, 20 Rutgers J.L. & Pub. Pol’y 209, 214 (2023) (describing the FDA as the most comprehensive drug regulatory system in the world); Jennifer Ko, What the FDA Can Teach Us About Regulatory Excellence, Regulatory Rev. (Jan. 16, 2018), https://www.theregreview.org/2018/01/16/fda-teach-regulatory-excellence/ (explaining that the FDA has had stricter approval requirements than most of the world since its inception, leading to minimized harm in numerous global pharmaceutical disasters like the birth defect endemic from thalidomide); Development & Approval Process | Drugs, FDA, https://www.fda.gov/drugs/development-approval-process-drugs#FDA (last visited Nov. 16, 2024) [hereinafter FDA Development and Approval] (detailing basics of federal drug testing and approval requirements).

[33] See Michael A. Santoro, Charting a Sustainable Path for the Twenty-First Century Pharmaceutical Industry, in Ethics and the Pharmaceutical Industry 1–5 (Michael A. Santoro & Thomas M. Gorrie eds., 2005) (explaining that the public sector is ill-suited to driving pharmaceutical innovation).

[34] See id.

[35] See generally About FDA, supra note 24 (showing the history and goals of the FDA as a whole).

[36] See Nahian & Wadhwa, supra note 25 (explaining where the FDA received its regulatory power from).

[37] See About FDA, supra note 24 (explaining the goal of the Food and Drug Administration).

[38] See generally id. (explaining how the FDA achieves its goals).

[39] See FDA Development and Approval, supra note 32 (describing how new drugs are developed and marketed).

[40] See id. (explaining that CDER operates as a consumer watchdog for the pharmaceutical industry).

[41] See id. (explaining how CDER works).

[42] See id. (describing the specific functions of CDER).

[43] See id.

[44] See id.

[45] See id.

[46] See Risk Evaluation and Mitigation Strategies (REMS), FDA, https://www.fda.gov/drugs/drug-safety-and-availability/risk-evaluation-and-mitigation-strategies-rems (last visited Nov. 16, 2024) (laying out the risk management requirements of the FDA in the pharmaceutical industry).

[47] See id. (explaining the FDA's risk management guidelines for the pharmaceutical industry).

[48] See id. (detailing the FDA's regulatory risk management framework for pharmaceutical industry).

[49] See id. (defining the FDA's risk management standards in the pharmaceutical sector).

[50] See id. (outlining the FDA's risk management requirements for the pharmaceutical industry).

[51] See FDA Development and Approval, supra note 32 (describing what is required for a drug to be approved); Risk Evaluation and Mitigation Strategies (REMS), supra note 46 (explaining that a high-risk drug may still be approved in certain circumstances).

[52] See FDA Development and Approval, supra note 32 (illustrating the many rigorous steps for FDA approval).

[53] See id. (clarifying that the 1992 Prescription Drug User Fee Act (PDUFA) set a goal of ten months for the standard approval process).

[54] See id.

[55] See id.

[56] See Tohru Takebe, The Current Status of Drug Discovery and Development as Originated in United States Academia: The Influence of Industrial and Academic Collaboration on Drug Discovery and Development, 11 Clinical & Translational Sci. 597, 601 (2018) (analyzing the rates of drug approval from step one until the end of the process).

[57] See The FDA’s Drug Review Process: Ensuring Drugs Are Safe and Effective, FDA, fda.gov/drugs/information-consumers-and-patients-drugs/fdas-drug-review-process-ensuring-drugs-are-safe-and-effective (last visited Nov. 16, 2024) (detailing the steps of the FDA approval process).

[58] See id.

[59] See id.

[60] See id.

[61] See id.

[62] See id.

[63] See id.

[64] See Goldberg et al., supra note 32, at 219 (explaining ways the FDA handles post-marketing discoveries and developments).

[65] See id.

[6 6 ] See id.

[67] See id.

[68] See id. at 215–16 (explaining the FDA regulation of the drug labeling system).

[69] See id. at 217.

[70] See id. at 217–18 (explaining the requirements for an FDA approved label).

[71] See id.

[72] See id.

[73] See id. at 219 (explaining ways the FDA handles post-marketing discoveries and developments).

[74] See FDA’s Labeling Resources for Human Prescription Drugs, FDA, https://www.fda.gov/drugs/laws-acts-and-rules/fdas-labeling-resources-human-prescription-drugs (last visited Nov. 16, 2024) (stating the reason for labeling requirements).

[75] See id.

[76] See id.

[77] See id.

[78] See About Us, U.S. Pat. & Trademark Off., https://www.uspto.gov/about-us (last visited Nov. 16, 2024) (describing how and why the U.S. Patent and Trademark Office exists).

[79] See Patent Act of 1790, ch. 7, 1 Stat. 109–112 (granting a patent holder “for any term not exceeding fourteen years, the sole and exclusive right and liberty of making, constructing, using and vending to others to be used, the said invention or discovery . . . .”).

[80] See Patent Basics, supra note 30 (explaining the basics of what patents are and the rights they grant).

[81] See id.

[82] See id.

[83] See id.

[84] See id.

[85] See Abbott & Dukes, supra note 27, at 16 (elaborating on innovation policy’s role in driving scientific progress).

[86] See id.

[87] See D. Daniel Sokol, Introduction, in Patent Assertion Entities and Competition Policy 1–7 ( D. Daniel Sokol ed., 2017) (asserting that Patent Assertion Entities (PAEs), commonly referred to as “Patent Trolls,” make money from licensing patents that they acquired through, or through threat of, litigation against firms that have used the discovery in their products).

[88] See Tom Nicholas, What Drives Innovation?, 77 Antitrust L. J. 787, 788 (2011) (“It has long been recognized that mechanisms like profits and capitalist institutions are needed for innovation to flourish.”). But see Plomer, supra note 1, at 1–13 (arguing for greater public access to pharmaceutical innovations and questioning the monopolistic and insulated nature of the pharmaceutical industry).

[89] See 35 U.S.C. §§ 200–13.

[90] See 35 U.S.C. § 203.

[91] See id.; Stanford Univ. v. Roche Molecular Sys., Inc., 563 U.S. 776, 785 (2011) (setting limits on the scope of the Bayh–Dole Act).

[92] See 35 U.S.C. § 204.

[93] See id.

[94] See id.

[95] See id.

[96] See Kevin Hickey & Emily G. Belvins, Cong. Rsch. Serv., IF12582, March-In Rights Under the Bayh-Dole Act: Draft Guidance 1 (2024) [hereinafter Bayh-Dole Draft Guidance] (weighing possible solutions to the NISTs failed attempt to include pricing in Bayh-Dole determinations).

[97] See id. at 2 (stating that NIST opened public comment on a proposal affirming march-in rights “shall not be exercised exclusively based on the business decisions of the contractor regarding the pricing of commercial goods and services”).

[98] See id. (weighing possible solutions to the NIST’s failed attempt to include pricing in Bayh-Dole determinations).

[99] See id.

[100] See id.

[101] See Air & Liquid Sys. Corp. v. DeVries, 586 U.S. 446, 462 (2019) (explaining the general goal of tort liability and common law).

[102] See generally Paul F. Rothstein & Ronald J. Coleman, Differentiating Strict Products Liability’s Cost-Benefit Analysis from Negligence, 56 Loy. L.A. L. Rev. 637, 639 (2023) (explaining the typical process for products liability in general and why strict liability over negligence is more appropriate).

[103] See Heidi Li Feldman, Pushing Drugs: Genomics and Genetics, the Pharmaceutical Industry, and the Law of Negligence, 42 Washburn L.J. 575, 580 (2003) (explaining the applicability of traditional torts in a highly regulated field).

[104] See id. (detailing how tort law claims may succeed against a pharmaceutical company).

[105] See generally Graham Dukes, The Law and Ethics of the Pharmaceutical Industry, at v (1st ed. 2006) (pointing out the ethical considerations in a controversial field).

[106] See Air & Liquid Sys. Corp., 586 U.S. at 462 (explaining the general goal of tort liability and common law).

[107] See generally Rothstein & Coleman, supra note 102, at 639 (explaining the purpose of tort law).

[108] See Goldberg et al., supra note 32, at 654 (explaining the required elements of successful tort claims).

[109] See id.

[110] See 1 California Products Liability Actions § 2.01(2)(d).

[111] See Goldberg et al., supra note 32, at 654 (detailing why strict liability is a difficult standard to meet).

[112] See id.

[113] See Restatement (Second) of Torts §§ 4, 281 (Am. L. Inst. 1979) (elaborating on the basics of common law negligence claims).

[114] See id.

[115] See id.

[116] See id.

[117] See id.

[118] See Kenneth S. Abraham & Leslie Kendrick, There’s No Such Thing as Affirmative Duty, 104 Iowa L. Rev. 1649, 1651 (2019) (defining affirmative duty in the realm of tort law).

[119] See id. at 1652 (explaining the circumstances where an affirmative duty may exist).

[120] See id. at 1655.

[121] See id. (defining reasonableness is the realm of tort law).

[122] See Goldberg et al., supra note 32, at 654 (explaining the elements tort claims).

[123] See Dilan A. Esper & Gregory C. Keating, Abusing Duty, 79 Cal. L. Rev. 265, 266 (2006) (explaining the basic elements that a plaintiff needs to prove for tort liability).

[124] See id.

[125] See id.

[126] See id.

[127] See 1 California Products Liability Actions § 2.01(1).

[128] See id. at § 2.12(1)(a).

[129] See id. at § 2.01(2)(d).

[130] See Rothstein & Coleman, supra note 102, at 651 (explaining the purpose for product liability and the reasoning for strict liability in such claims).

[131] See generally Feldman, supra note 103, at 580 (stating the most common claims against the pharmaceutical industry).

[132] See Rothstein & Coleman, supra note 102, at 660–63 (explaining how product defect claims are evaluated in a court of law).

[133] See id.

[134] See generally id. (explaining the type of successful product liability claims).

[135] See id. (explaining warning defect liability).

[136] See Howard Latin, "Good" Warning, Bad Products, and Cognitive Limitations, 41 UCLA L. Rev. 1193, 1206 (1994) (“People [should] read, understand, remember, and follow innumerable product warnings to protect themselves from all product-related risks they may confront.”).

[137] See id.

[138] See Feldman, supra note 103, at 580 (explaining the applicability of traditional torts in a highly regulated field).

[139] See id. (noting the frequent shortcomings of traditional tort claims in the pharmaceutical context).

[140] See id. (addressing the limitations of applying traditional tort theories to pharmaceutical litigation).

[141] See id. (explaining why plaintiffs bear a heavier burden than traditional torts plaintiffs in the pharmaceutical field).

[142] See Goldberg et al., supra note 32, at 224 (explaining how tort law treats the pharmaceutical industry); see FDA Development & Approval Process, supra note 32.

[143] See Goldberg et al., supra note 32, at 224 (explaining how tort law treats the pharmaceutical industry); see generally FDA Development & Approval Process, supra note 32 (explaining that risk in the pharmaceutical industry will never be zero).

[144] See Goldberg et al., supra note 32, at 224.

[145] See FDA Development & Approval Process, supra note 32 (explaining that risk in the pharmaceutical industry is impossible to eliminate, only minimized).

[146] See Goldberg et al., supra note 32, at 224.

[147] See id.

[148] See id.

[149] See Rothstein & Coleman, supra note 102, at 658 (explaining the risk-utility balancing test for strict products liability, mirroring the test conducted by the FDA approval process).

[150] See id.

[151] See id.

[152] See Goldberg et al., supra note 32, at 224.

[153] See id.

[154] See id.

[155] See id. (“This potential conflict between state failure-to-warn liability and federal drug labeling law has led to three Supreme Court cases over the past fourteen years. The Court has held that, under constitutional preemption principles, when such a conflict arises, the federal regulatory regime controls and the state claims are preempted.”).

[156] See id. (“[T]he goal for each label is to "portray the drug's safety profile with accuracy, balance, and brevity" to help physicians prescribe drugs in ways that maximize a drug's effectiveness and minimize risks.”).

[157] See id.

[158] See id.

[159] See id.

[160] See id. at 227–30 (stating that there should be “clear evidence” that a manufacturer acted in a way that would not be approved by the FDA).

[161] See Himes v. Somatics, LLC, 16 Cal. 5th 209, 218 (Cal. 2024) (“[M]anufacturers have a duty to warn physicians of the risks associated with their products but need not warn the patient regarding those same risks.”).

[162] See id.

[163] See id. at 219 (explaining that physicians are in a better position to impart the gravity of the situation to their patients).

[164] See id. at 222 (“As long as the manufacturer has adequately warned the patient's physician of the non-negligible risks of its prescription drug or medical device, the manufacturer has fulfilled its duty to warn.”).

[16 5 ] See id.

[166] See Dukes, supra note 105, at v (explaining the purpose of ethical rules to ensure fair play and smooth operation within the any industry).

[167] See id. at vii (elaborating on why the stakes of the pharmaceutical industry are different and higher than other industries).

[168] See id.

[169] See id. at 19–21 (explaining that ethics are rooted in human rights and the right to be protected from medical harm).

[170] See id. at 23 (explaining the increasing emphasis on ethical business practices in modern society).

[171] See generally Ethics and Compliance, Gilead Life Sciences, https://www.gilead.com/company/ethics-and-compliance (last visited Nov. 16, 2024) (explaining Gilead’s internal ethics codes and regulations).

[172] See Asia-Pacific Econ. Coop., Government Strategies to Encourage Ethical Business Conduct 8-9 (2020) (describing global policies and strategies for governments to steer the private sector towards ethical business practices).

[173] See Dukes, supra note 105, at 61 (“The growth of litigation involving pharmaceutical companies has . . . increased to the point where the costs involved can have a substantial effect on the well-being and good name even of a large corporation and its shareholders.”).

[174] See id. at 59 (detailing the financial and market pressures that effect any manufacturer of any product).

[175] See Michael A. Santoro, supra note 33 (summarizing why ethical decision-making in the pharmaceutical industry is not easy because of the numerous external and internal pressures that constantly weigh on the actors and decisionmakers).

[176] See id.

[177] See Selected top HIV/AIDS Drugs Worldwide Based on Revenue in 2023, supra note 3 (detailing the most prominent HIV drugs and manufacturers in the world by revenue with Gilead producing five of the top ten most profitable HIV treatments); Research, Gilead Life Sciences, https://www.gilead.com/science-and-medicine/research (last visited Nov. 16, 2024) (summarizing all of Gilead’s research endeavors in HIV prevention and treatment).

[178] See Gilead Life Scis., Inc. v. Superior Court, 98 Cal. App. 5th 911, 916 (2024) (explaining the plaintiffs’ complaint in the Gilead cases).

[179] See id.

[180] See id.

[181] See id.

[182] See Medicines, Gilead Life Sciences, https://www.gilead.com/science-and-medicine/medicines (last visited Nov. 16, 2024) (detailing all of Gilead’s currently marketed medications).

[183] See Gilead Life Scis., Inc., 98 Cal. App. at 916 (2024) (explaining the history of TDF and TAF development and its effects on the plaintiffs).

[184] See id.

[185] See Huilian Wang et al., The Efficacy and Safety of Tenofovir Alafenamide Versus Tenofovir Disoproxil Fumarate in Antiretroviral Regimens for HIV-1 Therapy, Medicine, Oct. 2016, at 1–2 (explaining what TDF and TAF are in relation to pure tenofovir).

[186] See id. at 6–8 (explaining the level of risk associated with TAF and TDF).

[187] See Tauqeer H. Mallhi et al., Drug-Metabolizing Enzymes & Fate of Prodrugs: From Function to Regulation, in Biochemistry of Drug Metabolizing Enzymes 127 (Muhammad S. H. Akash & Kanwal Rehman eds., 2022) (elaborating why prodrug formulas are used in all chemically unstable pharmaceuticals).

[188] See Huilian Wang et al., supra note 185, at 1–2 (explaining what TDF and TAF are in relation to pure tenofovir).

[189] See Guidelines for the Use of Antiretroviral Agents in Pediatric HIV Infection: Nucleoside and Nucleotide Analogue Reverse Transcriptase Inhibitors (NRTIs), ClinicalInfo.HIV.gov, https://clinicalinfo.hiv.gov/en/guidelines/pediatric-arv/tenofovir-af (last visited Nov. 16, 2024) (comparing the chemical breakdown of TDF and TAF in the blood).

[190] See id.

[191] See id.

[192] See id.

[193] See Patrick W. G. Mallon et al., Lipid Changes After Switch from TDF to TAF in the OPERA Cohort: LDL Cholesterol and Triglycerides, Open Forum Infectious Diseases, at 4–6 (detailing the unintended benefits of TDF and TAF on patients).

[194] See Huilian Wang et al., supra note 185, at 6 (explaining that cholesterol and LDL levels increase significantly after switching from TDF to TAF but noting the decrease in adverse bone and renal outcomes).

[195] See id. (explaining the rate of adverse outcomes is 0.75% for TDF and 0.17% for TAF).

[196] See Gilead Life Scis., Inc. v. Superior Court, 98 Cal. App. 5th 911, 919 (2024) (explaining the plaintiffs’ complaint in the Gilead Tenofovir Cases).

[197] See id.

[198] See id. at 917 (explaining Gilead’s response to the complaint).

[199] See id.

[200] See id.

[201] See id. (“First, we conclude that the legal duty of a manufacturer to exercise reasonable care can, in appropriate circumstances, extend beyond the duty not to market a defective product.”).

[202] See id.

[203] See id. at 935 (“[T]he distinction between ‘misfeasance’ and ‘nonfeasance,’ we now understand this terminology to be imprecise and prone to misinterpretation. The proper question is not whether an actor's failure to exercise reasonable care entails the commission or omission of a specific act.”).

[204] See id.

[205] See Gilead Life Scis., Inc. v. Superior Court, 320 Cal. Rptr. 3d 454, 454 (Cal. 2024) (granting the petition for review in the California Supreme Court on the grounds that the new duty creates divisive political implications).

[206] See Feldman, supra note 103, at 580 (“[T]ort doctrine has recognized this high-benefit/high-risk aspect of medicinal drugs, and tort law has shielded drug companies from liability imposed on other sorts of products manufacturers.”).

[207] See Asche et al., supra note 13 (elaborating on the impact and implications of the Gilead cases which spread farther than the pharmaceutical industry but to all industries that put products to the market).

[208] See id. (“This decision threatens the autonomy of drug and potentially other product manufacturers inasmuch as it gives the courts a seat at the boardroom table and allows them to weigh in on a company’s decisions to research, develop, and market a new drug or product. This is particularly concerning when the alternative drug or product is not even alleged to be unsafe, and the court is thus tasked with making what amounts to a purely business decision on behalf of companies.”).

[209] See Abbott & Dukes, supra note 27, at 3–11 (describing the reasoning for pharmaceutical policy, namely the capitalistic desire to increase profits in a what should be a public service industry).

[210] See id.

[211] See id.

[212] See California Invents a Crazy New Tort, Wall Street J., (Jan. 14, 2024), https://www.wsj.com/articles/california-gilead-hiv-drug-lawsuit-tort-law-2143597c (arguing that the ruling was not truly about torts or personal injury liability but about perceived moral failings of the pharmaceutical industry to put people before profit).

[213] See Dukes, supra note 105, at 61 (explaining that the pharmaceutical industry in not unlike any other industry, regardless of the overall purpose of the industry).

[214] See Jipping, supra note 16, at 148 (“Taking the Constitution on its own terms, then, exercising ‘legislative power’ (legislating from the bench) exceeds the judiciary's authority.”); Abbott & Dukes, supra note 27, at 3–13 (describing the purpose of legislation and policy to regulate the pharmaceutical industry).

[215] See Abbott & Dukes, supra note 27, at 3–13 (describing the purpose of legislation and policy to regulate the pharmaceutical industry).

[216] See Dukes, supra note 105, at 219 (“[I]n its own interests, both as regards immediate economies and the long-term development of better drugs, society should approach the issue of drug pricing with much more care and more selectively than it has often done to date.”).

[217] See id. at 215–19 (emphasizing the free market of specialized pharmaceutical marketing)

[218] See Plomer, supra note 1, at 1–13 (stating that the nature of the pharmaceutical industry and the patenting system allows for more tendencies towards anticompetitive practices amongst the major players).

[219] See Dukes, supra note 105, at 224, 228 (explaining the societal control of the price of medicine and pharmaceutical developments and its relation to the cost of development)

[220] See id. at 227 (explaining the economic evaluation of drug prices).

[221] See id. at 234 (detailing future ethical and economic approaches to profit maximization and pricing in the pharmaceutical industry and their drawbacks).

[222] See id.

[223] See id.

[224] See Asia-Pacific Econ. Coop, supra note 172, at 8–9 (describing global policies and strategies for governments to steer the private sector towards ethical business practices without creating explicitly state-run industries and encourage market freedoms).

[225] See id.

[226] See California Invents a Crazy New Tort, supra note 212 (arguing the court is creating a ‘duty to innovate’ even if they claim not to be because they created liability for delaying release of products).

[227] See Brief for International Center for Law & Economics et al. as Amici Curiae supporting Petitioner, Gilead Life Scis., Inc. v. Superior Court, 320 Cal. Rptr. 3d 454 at 6–7 (Cal. 2024) (No. S283862) (highlighting the issues and implications of the Gilead ruling).

[228] See id.

[229] See Asche et al., supra note 13 (elaborating on the impact and implications of the Gilead cases which spread farther than the pharmaceutical industry but to all industries that put products to the market).

[230] See id.

[231] See id.

[232] See id.

[233] See id.

[234] See Feldman, supra note 103, at 579–81 (“Historically, tort doctrine has recognized this high-benefit/high-risk aspect of medicinal drugs, and tort law has shielded drug companies from liability imposed on other sorts of products manufacturers.”).

[235] See id.

[236] See Abraham & Kendrick, supra note 118, at 1651–55 (explaining the bounds of affirmative duties in tort law).

[237] See Gilead Life Scis., Inc. v. Superior Court, 98 Cal. App. 5th 911, 917 (2024) (detailing the plaintiffs’ allegations and the consequences of product usage).

[238] See Goldberg et al., supra note 32, at 224 (explaining how controlling tort law treats the pharmaceutical industry).

[239] See FDA Development & Approval Process, supra note 32 (detailing requirements for a drug to be FDA approved and releasable into the market).

[240] See Gilead Life Scis., Inc., 98 Cal. App. 5th at 917 (describing what the plaintiffs alleged in their complaint).

[241] See id.

[242] See id. at 935 (“[T]he distinction between ‘misfeasance’ and ‘nonfeasance,’ we now understand this terminology to be imprecise and prone to misinterpretation. The proper question is not whether an actor's failure to exercise reasonable care entails the commission or omission of a specific act.”).

[243] See Goldberg et al., supra note 32, at 214–19 (detailing the degree of FDA regulation of the field, covering most, if not all, of the typical tort causes of action).

[244] See id.

[245] See id.

[246] See id.

[247] See id. (explaining the responsibility to conduct “post-market surveillance to assess the drug's safety and efficacy results and determine whether any new drug safety information emerges that requires changes to the drug label”); Rothstein & Coleman, supra note 102, at 657–59 (explaining manufacturer’s duty of care in relation to product design defects).

[248] See Goldberg et al., supra note 32, at 214–19 (explaining a drug manufacturer’s duties dictated by the FDA and their relation to legal action); Rothstein & Coleman, supra note 102, at 657-59 (explaining manufacturer’s duty of care in relation to product design defects).

[249] See Gilead Life Scis., Inc. v. Superior Court, 98 Cal. App. 5th 911, 921 (2024) (explaining that plaintiffs argue their negligence claim is premised on Gilead's possession of the alternative drug and intentional withholding of TAF following its invention, which the court agrees is a valid claim and not imposing a duty to innovate); See California Invents a Crazy New Tort, supra note 212.

[250] See California Invents a Crazy New Tort, supra note 212 (reasoning that the Gilead Life Sciences ruling harms not only the pharmaceutical industry, but places excess burdens on any and all inventors and manufacturers).

[251] See Jipping, supra note 16, at 148 (“Taking the Constitution on its own terms, then, exercising ‘legislative power’ (legislating from the bench) exceeds the judiciary's authority.”).

[252] See U.S. Const. art. I, § 8, cl. 8 (highlighting Congress’s power to promote the progress of useful arts and sciences).

[253] See California Invents a Crazy New Tort, supra note 212 (explaining how the Gilead ruling may be used to drastically change how all industries must approach innovation).

[254] See id.

[255] See id. (explaining why the Gilead ruling is erroneous and not in keeping with traditional judicial boundaries).

[256] See generally Patent Basics, supra note 30 (detailing the rights granted to patent holders and how those rights are protected).

[257] See, e.g., U.S. Const. art. I, § 8, cl. 8 (highlighting Congress’s power to promote the progress of useful arts and sciences, not limiting to one field of science).

[258] See 1 California Products Liability Actions § 2.01(1) (noting the requirements and limitations for any product liability action, including carve-outs for unavoidably unsafe products).

[259] See California Invents a Crazy New Tort, supra note 212 (arguing that ,while the ruling will be use in different industries to force innovation, the pharmaceutical industry will be hit the hardest and could lead to lapse in safety to avoid this new liability).

[260] See id.

[261] See id.

[262] See Plomer, supra note 1, at 1–13 (stating that the nature of the pharmaceutical industry and the patenting system allows for more tendencies towards anticompetitive practices amongst the major players but could be addressed through different areas of law and interventions).

[263] See id.

[264] See id.

[265] See Dukes, supra note 105, at 219 (“[I]n its own interests, both as regards immediate economies and the long-term development of better drugs, society should approach the issue of drug pricing with much more care and more selectively than it has often done to date.”).

[266] See Bayh-Dole Draft Guidance, supra note 96, at 1 (explaining how the Bayh–Dole Act may impact pricing schemes of the pharmaceutical industry).

[267] See id.

[268] See Fred Ledley, Ekaterina Cleary, & Matthew Jackson, US Tax Dollars Funded Every New Pharmaceutical in the Last Decade, Inst. for New Econ. Thinking (Sep. 2, 2020) https://www.ineteconomics.org/perspectives/blog/us-tax-dollars-funded-every-new-pharmaceutical-in-the-last-decade (explaining that federal funding has had a role to play in every pharmaceutical development of the 2010s, amounting to 40% of the NIH’s budget and $235 billion in direct or indirect funding).

[269] See Bayh-Dole Draft Guidance, supra note 96, at 1 (detailing how the exercise of Bayh–Dole rights may be accomplished and who may exercise them).

[270] See id. at 2 (stating that NIST opened public comment on a proposal affirming march-in rights “shall not be exercised exclusively based on the business decisions of the contractor regarding the pricing of commercial goods and services.”).

[271] See id. (weighing possible solutions to the National Institute of Standards and Technology’s failed attempt to include pricing in Bayh-Dole determinations).

[272] See id. (“For example, Congress could consider legislation to amend 35 U.S.C. § 203 in a way that either explicitly requires or prohibits the consideration of specific factors, such as price, in march-in determinations.”).

[273] See id.

[274] See id.

[275] See id. (“Congress may weigh the possible impacts that march-in rights have on pricing of patented products and incentives for innovation and R&D . . . .”).

[2 7 6] See id.

[277] See id.

[2 7 8] See Gilead Life Scis., Inc. v. Superior Court, 98 Cal. App. 911, 918 (2024) (extending the scope of the traditional pharmaceutical duty of care that applies to affirmative actions to a reasonable declination to act when deciding when to market their new products).

[279] See Brief for International Center for Law & Economics et al. as Amici Curiae supporting Petitioner, Gilead Life Scis., Inc. v. Superior Court, 320 Cal. Rptr. 3d 454 (Cal. 2024) (“The threat of massive liability simply for not developing a drug sooner would make companies reluctant to invest the immense resources needed to bring new treatments to patients.”).

[280] See Jipping, supra note 16, at 148 (explaining the limits of the power of the judicial system and the separation of powers between the legislative and judicial branches); Abbott & Dukes, supra note 27, at 3–13 (describing the purpose of legislation and policy to regulate the pharmaceutical industry and how the industry operates because of its impact on the health and safety of the public).

[281] See Saxena, supra note 1, at 2 (explaining that further burdens on the pharmaceutical industry may have a counterintuitive effect by forcing drugs to market too soon or significantly disincentivizing the development process in order to comply with the new standard).

[282] See Santoro, supra note 33, at 1–5 (explaining that the private sector is necessary in the pharmaceutical industry because the public sector is incapable of taking on the financial risk associated with medical and pharmaceutical innovation).

[283] See id.

[284] See id.; Asche et al., supra note 13 (explaining the implications of the Gilead ruling on the pharmaceutical industry and American industry as a whole).

Balancing Safety and Profit: A Defense of Pharmaceutical Liability Standard