Even if an impurity is detected in a pharmaceutical, if the drugmaker was not negligent in the manufacturing and management process and it does not harm the human body, health authorities cannot require the company to shoulder the expense of re-prescribing and re-dispensing, a court has ruled.
According to legal sources on the 26th, the 20th Civil Division of the Seoul Central District Court (Presiding Judge Lee Sera) ruled entirely in favor of the plaintiffs in a lawsuit for the return of unjust enrichment filed by A Pharmaceutical and others against the National Health Insurance Service over impurities (NDMA) in drugs. If the ruling is finalized, drugmakers can recover 960 million won already paid and interest from the National Health Insurance Service.
Earlier, in 2018, health authorities said an impurity called N-nitrosodimethylamine (NDMA) exceeding standards was detected in valsartan-based drugs used to treat high blood pressure and took steps for patients to exchange drugs already prescribed for alternative medications. The National Health Insurance Service required drugmakers to bear the expense of re-prescribing and re-dispensing incurred in the process.
In 2019 and 2020, NDMA exceeding standards was also detected in ranitidine- and nizatidine-based drugs used to treat excess stomach acid and in metformin-based drugs used to treat diabetes. The National Health Insurance Service likewise required drugmakers to bear the expense of re-prescribing and re-dispensing.
Drugmakers supplied valsartan drugs according to prescribed standards but filed suit against the National Health Insurance Service, saying it was unjust to make them bear the expense of re-prescribing and re-dispensing. However, the court found that after health authorities published a testing method for detecting NDMA, drugmakers failed to meet their duty of care and had legal liability. That ruling was finalized by the Supreme Court in Apr. 2024.
In Jul. 2022, drugmakers filed a lawsuit for the return of unjust enrichment against the National Health Insurance Service, saying the expense of re-prescribing and re-dispensing for ranitidine, nizatidine, and metformin drugs had been improperly collected.
Lee & Ko, representing the drugmakers, argued that the chemical structures of ranitidine, nizatidine, and metformin drugs differ from valsartan, and that imposing legal liability on drug suppliers hastily could instead cause harm to patients.
As with the valsartan drug case, it was anticipated that drugmakers' legal liability would be recognized after health authorities published a testing method for detecting NDMA. However, the court of first instance found the drugmakers' arguments persuasive and issued a ruling upholding the claim.
Park Hyeon-su, an attorney on the litigation team at Lee & Ko who led this case, said, "This case will serve as an important precedent offering insight into the scope and limits of legal liability borne ex post by suppliers who manufactured products in full compliance with past standards, including for other products such as food."