Merck Appears To Resolve Legal Uncertainty By Settling Vioxx Suits For $4.85 Billion Update 11-10

Having arthritis may have become a little less painful. Vioxx was touted as a near miracle drug. Many arthritis patients cringed when Merck pulled the product from pharmacies. For those who have survived complications of the drug, getting up in the morning may be a little bit easier. Merck & Co. will pay $4.85 billion to settle thousands of lawsuits concerning Vioxx, an anti-inflammatory drug. There were potentially 26,600 lawsuits representing 47,000 plaintiffs. In addition there were potentially 265 class action cases. Plaintiff's claim that they or family members who used the drug had disabling or fatal consequences. The agreementattempts to settle all of the cases filed in federal and state courts. In order for the deal to be binding, 85 percent of all plaintiffs must agree to drop their cases. Three of four judges who are overseeing most of the Vioxx claims participated in the settlement discussions. It is estimated that the average settlement may be about $100,000 per injured party.

After losing the first Vioxx case for $253 million, Merck has won a several civil cases in numerous states. Merck put $70 million in reserves for defending lawsuits. As of Sept. 30, Merck had reserved a total of $1.92 billion for legal expenses and spent a total of $1.2 billion.
Settlements under the plan would vary depending on injuries and the length of time the injured party used Vioxx. "We've been asked by the judge to talk to the plaintiffs and we are talking to them.. right now there is no finalized agreement," said Kent Jarrell, spokesman for Merck. Even if the lawsuits are settled, Merck must still contend with a number of state and federal investigations. To date there is no indication that the executives will face criminal charges like the Purdue executives faced with Oxycontin. See 7-21-07 Legal Pub Oxycontin Article. Legal Pub Link.