Texas Court Holds that Compounding Pharmacies are Subject to Requirements of the Texas Medical Liability Act

On April 24, 2015, in a significant win for pharmacies in the State of Texas, the Texas Supreme Court dismissed a plaintiff’s product liability action that alleged that the lipoic acid treatment she received caused her to go blind. The court held that the defendant compounding pharmacy that provided the supplement was entitled to protection under the Texas Medical Liability Act (TMLA) and dismissed the case. The decision is available here.

In 2011, Ms. Miller was undergoing weekly injections of lipoic acid with her physician to treat a medical condition. She had no reaction to the first 9 weeks of treatment, but while receiving the tenth treatment she had a severe adverse reaction and was hospitalized. She is now permanently blind in both eyes.

A licensed compounding pharmacy in Arlington, Texas had compounded the vile of lipoic acid to which Ms. Miller reacted. Ms. Miller and her husband filed a lawsuit against the compounding pharmacy, and several of its employees, alleging that her severe adverse reaction to the compounded lipoic acid was caused by the company’s negligence and failure to warn in compounding and providing the supplement.

The defendant moved to dismiss, arguing that the plaintiff had asserted health care liability claims governed by the Texas Medical Liability Act and requested that the claims be dismissed because plaintiffs failed to serve an expert report, as required, within 120 days of the filing of the lawsuit. (Tex. Civ. Prac. & Rem. Doe §§74.001-.507). The trial court denied the motion, and a divided court of appeals affirmed its decision, holding that the pharmacist defendants were not health care providers and that the claims were not health care liability claims under the TMLA.

However, the Supreme Court of Texas disagreed and reversed the decision. The TMLA requires that plaintiffs serve expert reports early in the litigation process “for each physician or health care provider against whom a liability claim is asserted.” The Supreme Court of Texas determined that Miller’s claims were health care liability claims. The court determined that the lipoic acid is not a prescription drug, but because it can only be ordered by a physician, it should be treated as a prescription medicine under the TMLA.

This ruling by the Supreme Court of Texas will benefit all pharmacies in Texas, and confirms that the intent of the TMLA was to require expert testimony to determine if the act of compounding medicine deviated from accepted standards of care. The decision will reduce the medical malpractice risk for compounding pharmacies in that state, while making it more difficult, and more costly, for plaintiffs that allege they were injured by improperly compounded medicines from those pharmacies.