Former Lilly employee wins an ironic lawsuit over disability benefits

How’s this for irony?

A federal appeals court ruled last week that Eli Lilly should not have ended disability benefits to a former human resources director who claimed she was unable to continue working because she suffered from fibromyalgia, a chronic neurologic condition.

Yet at the same time the former employee was fighting in court to have those benefits restored, the drug maker was marketing a medicine in the US to treat the condition, which one of its own consultants had described as “very disabling,” according to court documents.

Moreover, when Cymbalta was approved in the US in 2008 to treat the condition, Lilly issued a press release in which an executive of the National Fibromyalgia Association was quoted as saying it is a “life-altering disorder.” That same year, Lilly was one of two drug makers that provided 40 percent of the association’s funding, according to an Associated Press analysis at the time.

In effect, the company wanted it both ways. The drug maker sold a medicine for a condition that it had a hand in touting as disabling, but when one of its own employees claimed she suffered from the ailment, the company tried to insist she was capable of performing some work.

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The dichotomy was not lost on the court panel.

Two of three judges who ruled in favor of the former human resources director, Cathleen Kennedy, noted that Lilly is “familiar with fibromyalgia, because it markets a drug called Cymbalta for treating the disease.” (The drug, which is also approved for treating depression and other ailments, lost patent protection in the US four years ago, but Lilly still actively markets it elsewhere).

At issue was the extent to which her ailment was, in fact, truly disabling.

Hired in 1982, Kennedy ceased working in 2009, citing fibromyalgia. In late 2012, however, her benefits were ended. A dispute quickly ensued as Kennedy filed a lawsuit. Lilly argued she was capable of performing some level of work. Yet the judges described the evidence that Lilly subsequently provided to support its contentions as a “hodge-podge” and that it contained “deficiencies.”

For instance, the company’s Employee Benefits Committee failed to mention conclusions from different doctors who evaluated Kennedy, two of whom were psychiatrists. Another was a urologist, whose assessment the judges found to be “irrelevant.” And yet another physician testified the American College of Rheumatology does not consider fibromyalgia to be disabling on a long-term basis, which the judges noted was false.

Ultimately, the judges wrote that Lilly failed to indicate what job or kind of job, and at what level, Kennedy would have been capable of performing “if the company is permitted to cancel her benefits.”

A Lilly spokeswoman declined to comment.

But by cutting off her benefits, the drug maker saved itself about $2.5 million, which the judges described as “not a trivial loss.” Indeed, that is not a trivial amount to Kennedy, although some may see it as a relative pittance to a company that generated more than $21 billion in sales last year.

The judges added, by the way, that there was a “questionable aspect” to Lilly’s case because of a conflict of interest. The company adjudicated the benefits claim and also must pay those benefits.

We should note that one of three judges on the panel dissented, and sided with arguments that Kennedy appeared to have been capable of some work and, therefore, the decision by the plan to deny her benefits was not “arbitrary and capricious.”