US Merck Resolves Latest Vioxx Lawsuit
In an out-of-court settlement with plaintiffs in a multi-district class action lawsuit brought by shareholders in a New Jersey federal court, US drugmaker Merck & Co has agreed to pay $830 million to resolve the claims, plus an additional amount for approved attorneys’ fees and expenses. Merck said a small portion of the payout is covered by insurance. It will take an undisclosed charge for the fourth quarter of 2015, which will be excluded from non-GAAP results.
The company said the settlement class is made up of persons who purchased its securities between May 21, 1999 and Oct. 29, 2004 and who have sought to recover damages under the federal securities laws for “certain Merck statement” regarding the painkiller Vioxx.
In the suit, the shareholders claimed Merck made “false and misleading statements” about the drug’s safety. They alleged also that they paid inflated prices the shares because of the company’s conduct.
Merck withdrew the drug 11 years ago after a colon-polyp prevention study showed it more than doubled the risk of heart attacks or stroke after 18 months of use. According to reports, as many as 38,000 people died from Vioxx-related side effects, and about 160,000 patients suffered internal injuries and damage.
With the latest settlement, the company’s total payouts to settle Vioxx-safety-related litigation has risen to at least $6 billion, said the newspaper Wall Street Journal, adding that this is in addition to its own legal-defense costs. Some related litigation is still pending.
Merck said the agreement, which is subject to court approval, does not constitute any admission of any liability or wrongdoing.
