Pharmacists Mutual pursues case to establish compounding pharmacists as health care providers in Texas

Pharmacists Mutual pursues case to establish compounding pharmacists as health care providers in Texas

By Don McGuire, R.Ph., J.D., General Counsel Pharmacists Mutual Companies

Pharmacists Mutual Insurance Company defended a case against our insured pharmacy that had important implications for the pharmacy profession.  In this case, the patient received an infusion of Lipoic Acid in her physician’s office in 2011.  She suffered adverse reactions which resulted in weeks of hospitalization and permanent blindness.  The patient blamed her injuries on the compounded Lipoic Acid and filed suit against her physician, the pharmacy, and six of its pharmacists.  The allegations against the pharmacy and pharmacists included assertions that the Lipoic Acid was negligently prepared and was of an unsafe design. 

Cases filed in Texas against physicians and other health care providers fall under the Texas Medical Liability Act.  The Act requires that the plaintiff file an expert report within 120 days of the suit being filed.  Failure to file the required expert report will result in dismissal with prejudice of the case upon the motion of a health care provider.  The patient here did not file an expert report against the pharmacy or the pharmacists.  The pharmacy and pharmacists moved for dismissal.  The trial court denied the defendants’ motion concluding that the patient’s claims were not health care liability claims as defined in the Act and the pharmacists were not health care providers as defined in the Act. 

The pharmacy and pharmacists appealed the ruling.  The Texas Court of Appeals affirmed the trial court’s decision and distinguished between pharmacists dispensing compounded medications directly to patients (covered by the Act) and those pharmacists providing compounded medications to physicians for office use (not covered by the Act).  Following this ruling, the pharmacy and pharmacists appealed to the Texas Supreme Court.

The Texas Supreme Court reversed the previous rulings and ordered that the case be dismissed pursuant to the Texas Medical Liability Act for the failure to provide the expert report[1].  The Supreme Court concluded that the patient’s claims were health care liability claims as defined under the Act and that the pharmacists in this case were health care providers as defined under the Act.  Analyzing the Act, the Texas Pharmacy Act, and the Board of Pharmacy regulations, the Court concluded that compounding pharmacists providing office use compounds to physicians were indeed health care providers and that the patient’s claims constituted a health care liability claim.

Other insurance carriers may not have recognized how detrimental the trial court and court of appeals decisions were to the practice of pharmacy.  From a purely economic perspective, other insurers may have settled the case following the trial court’s ruling to end defense costs and avoid a potentially large judgment.  However, Pharmacists Mutual not only provides insurance protection for the pharmacy profession, but is an active promoter of the profession of pharmacy and the value that it can provide to the health care system in this country.  The decision to push the case forward resulted in compounding pharmacists providing office use compounded medications being considered as health care providers under the Texas Medical Liability Act.  This respect for, and promotion of, the pharmacy profession is what sets Pharmacists Mutual Insurance Company apart from other pharmacy insurers.


[1] Randol Mill Pharmacy, et al. v. Stacey Miller and Randy Miller, 465 S.W.3d. 612, (Tex., April 24, 2015).