Merck settles Vioxx cases for $4.85B
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| Merck manufactured Vioxx manufactured until 2004. Source: Science Toys |
Today’s action comes three years after Merck withdrew Vioxx from the market. The payments will be delivered to the plaintiffs, who either suffered injuries from using the medication or had family members die from its use. Merck stated that the litigation was not a class-action settlement and the claims will be distributed on an individual basis.
Merck said that the agreement was “signed by the parties this morning after they met with three of the four judges overseeing the coordination of more than 95 percent of the current claims in the Vioxx litigation.”
Merck intends to record a fourth-quarter 2007 pre-tax charge in the amount of $4.85 billion to cover the cost of the agreement. The company said that $4 billion will be directed toward myocardial infarction claims and $850 million toward ischemic stroke claims.
The New York Times reported that the “settlement will help put Vioxx behind Merck, as well as sharply reduce its Vioxx-related legal defense fees, which are now running at more than $600 million annually.”
The settlement does not resolve the government investigations, including one filed in September by the New York attorney general and New York City Mayor Michael Bloomberg. Several government lawsuits allege that Merck deliberately suppressed and concealed information about the seriousness of the cardiovascular risks associated with Vioxx, claiming that many prescriptions would never have been written had doctors been properly informed. The joint action is seeking restitution for the payment of city and state Medicaid prescriptions.
The Whitehouse, N.J.-based Merck has announced that it “will continue to defend all claims that are not included in the resolution process.”