Merck Paying More Than 3,100 Fatality Claims In Vioxx Settlement
The fund will pay about 3,000 claims for heart attack deaths and at least 122 strokes, according to BrownGreer LLP, a claims administrator appointed by both sides. Merck introduced Vioxx in 1999 and withdrew it in 2004 when a study showed the drug doubled the risk of heart attacks and strokes. Merck set up the fund, which covers claims of death and lesser injuries, in 2007 after reserving $1.9 billion to fight 26,600 Vioxx suits.
“We dont know any drug right now with this number of deaths associated with it,” said Houston attorney Mark Lanier, a Vioxx plaintiffs lawyer who is appealing the reversal of a $256 million verdict against Merck. “This is a very sad chapter in the American tragedy of pharmaceutical companies gone wild.”
Merck, which is set to buy rival Schering-Plough Corp. by the end of the year, won 11 of 16 Vioxx suits at trial before agreeing to settle all claims. Under the accord, the facts of each case determine the extent of Mercks liability, which analysts once estimated to be as much as $20 billion overall. BrownGreer said its almost done reviewing 48,507 claims. So far, the firm has rejected 40 percent of them.
Stock Increase
Merck rose 24 cents to $31.25 in New York Stock Exchange composite trading yesterday, after rising as much as 2.3 percent.
“Its a good thing to clear the deck before you merge with Schering. You want to clear off all these outstanding issues so you can merge in peace. Its one less distraction,” said Les Funtleyder, a health-care analyst with Miller Tabak & Co. in New York, in a phone interview.
Families of heart attack victims who died will get an average payment of about $374,000, according to BrownGreer. Some will get as little as $5,000 and others more than $1.5 million, depending on the Vioxx users age, how long they took the drug and whether they had health risks such as obesity or hypertension, said Andy Birchfield, a plaintiffs lawyer in Montgomery, Alabama, who helped negotiate the settlement.
“The settlement relies on objective criteria,” said Merck attorney Ted Mayer of Hughes Hubbard & Reed LLP in New York. “Theres no admission regarding causation or fault. The track record in the courtroom is that plaintiffs failed again and again to establish causation.”
Lawyers Share
Claimants taking part in the settlement dont have to prove Vioxx caused their specific injuries. Details on the payments to individual claimants, who are ranked on one of six levels, are confidential. Claimants lawyers will be paid as much as $1.55 billion of the settlement fund.
Orran Brown, chairman of BrownGreer, said the fund will pay “an unspecified number” of claims on behalf of Vioxx users whose deaths didnt meet the criteria for payments related to the drugs use. He said the number hasnt been disclosed publicly and he wasnt authorized by Merck and plaintiffs lawyers to release it.
Its Plenty Bad
David Logan, dean of Roger Williams University Law School in Rhode Island, said after being told the figure, that “its plenty bad that the numbers are that high.”
Merck, based in Whitehouse Station, New Jersey, settled after battling plaintiffs who claimed in state and federal courts that it didnt adequately disclose Vioxx safety data to the U.S. Food and Drug Administration, didnt properly warn doctors and patients of the drugs risks and misrepresented the potential harm in marketing materials.
Plaintiffs claimed Merck should have moved more quickly to warn about the dangers of Vioxx after a 2000 study reported that the medicine caused five times more heart attacks than another painkiller, naproxen. Merck took two years to negotiate a change in Vioxxs label on side effects with the FDA.
“Merck acted responsibly in studying the medicine and sharing data with the FDA and physicians and in voluntarily withdrawing Vioxx from the marketplace in 2004,” Merck lawyer Mayer said.
Heart Attacks
Jerome Avorn, a Harvard Medical School professor, said “clearly there were preventable heart attacks and strokes.”