Tuesday, August 21, 2007

How Is Merck Faring in Vioxx Lawsuits? Very Well, Thank You

If ever a company looked as if it was all set to lose its shirt in court, it was Merck, when it was finally forced to withdraw Vioxx from the market in 2004. The published evidence, in hindsight, was crystal clear that the company should have known about the risks of heart attack as far back as the late 1990s, and internal company documents only confirmed the company's awareness of the risks. Yet Merck continued not only to sell the drug, but to market it heavily--and as a first line choice, not merely for those thought to be at higher risk of stomach bleeding (the purported main advantage of the class of drugs).

So now it's three years down the road. And, as Alex Berenson reports in the New York Times, the liability risk once estimated to be as high as $25 billion has shrunk to $5 billion. And after Merck stock plunged at the first adverse jury award, it has since regained 80 percent of its value.

How has Merck done it? It has simply decided to use its financial muscle ($1 billion so far spent on legal fees) to fight each case individually, and to appeal every adverse ruling all the way up. The courts have helped by insisting that each case be tried separately and opposing any class action suits.

The medical facts work in Merck's favor in such a setting. We can know, on a population basis, that there may have been as many as 140,000 excess heart attacks in the U.S. during the five years that Vioxx was on the market after the risks were clear. The problem is to translate that number into the reasonable certainty that John Doe of Podunk, East Dakota was one of those heart attacks--that he had his particular heart attack when he did because he took Vioxx, and that his high blood pressure, high cholesterol, or other risk factors had nothing to do with it. So far, in most cases that have come to court, Merck lawyers have managed to create reasonable doubt that Vioxx was the cause of the heart attack. And, in the case of Robert Ernst, where the jury found against the company and demanded $253 million, the case is still tied up in appeals and the Ernst family lawyer predicts that if they see any money at all, it won't be until 2010.

I'm no legal expert, but it seems from this vantage point that if you want to have your day in court in the U.S., having an extra billion or so dollars in your pocket does not hurt.

Berenson A. Plaintiffs find payday elusive in Vioxx cases. New York Times, Aug. 21, 2007.

1 comment:

Anonymous said...

My name is Tony Gomez and i would like to show you my personal experience with Vioxx.

I am 56 years old. Have been on Vioxx for 2 years now. Everybody that works for the fda that oked this drug should be put in jail.

I have experienced some of these side effects -
heart attack hardening of the arteries and nerve damage in my feet

I hope this information will be useful to others,
Tony Gomez