Merck loses Two Vioxx liability cases in one day

A federal jury in New Orleans found  that the giant drug manufacturer Merck failed to warn doctors about the medical risks of Vioxx. The jury ruled that the company must pay a retired F.B.I. agent who suffered a heart attack while taking the drug $51 million in damages.

 Earlier in the day, a state court judge in New Jersey overturned an earlier verdict in favor of the company in another Vioxx suit.

The New York Times reports (below) "So far, plaintiffs and Merck have won four cases each, not including the New Jersey case in which the decision was overturned. Jurors have sharply punished Merck in each case it has lost, awarding plaintiffs an average of almost $90 million in compensatory and punitive damages, which are supposed to be given only in cases of egregious corporate conduct."

Had FDA been doing its mandated oversight job Merck would likely not have broken the law by concealing the lethal risks of its drug.  But FDA’s collusion with drug manufacturers leaves the public at the mercy of rogue companies and an unscrupulous business culture.

Contact: Vera Hassner Sharav
veracare@ahrp.org
 
~~~~~~~~~~~~~~
http://www.nytimes.com/2006/08/18/business/18merck.html?
THE NEW YORK TIMES
August 18, 2006
Merck Suffers a Pair of Setbacks Over Vioxx
By ALEX BERENSON

In a significant setback for Merck, a federal jury in New Orleans awarded a retired F.B.I. agent $51 million yesterday for a mild heart attack that he suffered after taking the painkiller Vioxx for almost three years.

The verdict is the fourth multimillion-dollar loss for Merck, Vioxx’s maker, in litigation over the drug. It came the day a state court judge in New Jersey overturned an earlier verdict in favor of the company in another Vioxx suit.

Merck, the third-largest American drug maker, said it would appeal both decisions, but the company’s shares fell almost 6 percent.

The company faces more than 14,000 lawsuits, covering almost 30,000 plaintiffs, from people who claim they or their relatives suffered heart attacks or strokes after taking Vioxx. The company says it did nothing wrong in researching or marketing the drug and plans to defend every lawsuit.

In the New Orleans case, a federal jury found unanimously that Merck had failed to warn doctors about Vioxx’s risks and was responsible for the heart attack suffered by the retired agent, Gerald Barnett, 62.

Mr. Barnett began taking Vioxx after a car accident in early 2000 and suffered a heart attack in September 2002. He continued taking Vioxx until shortly before Merck stopped selling the drug in September 2004.

After less than a day of deliberations, the jury awarded Mr. Barnett $50 million in compensatory damages, and an additional $1 million in punitive damages. The case was tried before Judge Eldon E. Fallon of Federal District Court, who is overseeing 5,700 Vioxx suits.

Plaintiffs’ lawyers lauded the verdict and said that it would increase pressure on Merck to reach a mass settlement.

“If the jury believes that the person took Vioxx regularly, they will hold Merck liable for the heart attack,” said Robert Gordon, a plaintiffs’ lawyer at Weitz & Luxenberg. Mr. Gordon helped try a Vioxx case in New Jersey this spring in which a jury in state court awarded $4.5 million to Thomas McDarby, a 77-year-old man who suffered a heart attack after taking Vioxx for almost two years.

Lawyers for Merck said they would not change their strategy.

“While this is not the outcome we had hoped for, our commitment to defending these cases one at a time remains the same,” Merck’s general counsel, Kenneth C. Frazier, said in a statement.

Merck noted that plaintiffs’ lawyers had chosen to try the Barnett case because it was stronger than the average suit the company faces.

Before yesterday’s decisions, Merck’s strategy of aggressively defending cases, rather than looking for a settlement, appeared to be paying dividends. This summer, Merck has won state court cases in New Jersey and California, and lawyers for plaintiffs in federal court have dismissed hundreds of suits.

Lawyers now estimate that Merck will face 35,000 to 40,000 lawsuits, rather than the 100,000 that were initially forecast, and investors have lowered their estimates of the company’s overall liability in the litigation to $10 billion or less, rather than the $20 billion or more initially forecast.

Since their lows last fall, Merck shares are up about 50 percent, even after yesterday’s decline. They trade less than 20 percent below their levels in September 2004, before Merck stopped selling Vioxx. Merck closed yesterday at $38.83, down $2.35.

But yesterday’s verdict highlights the risks of Merck’s strategy. While the company faces fewer cases than initially expected, those that remain appear strong. And Merck continues to struggle to explain e-mail messages from its scientists discussing Vioxx’s potential risks as early as 1997, two years before the drug reached the market.

So far, plaintiffs and Merck have won four cases each, not including the New Jersey case in which the decision was overturned. Jurors have sharply punished Merck in each case it has lost, awarding plaintiffs an average of almost $90 million in compensatory and punitive damages, which are supposed to be given only in cases of egregious corporate conduct.

Those large losses are unsustainable, said W. Mark Lanier, who won a $253 million verdict against Merck last year in the first Vioxx case to reach trial and worked alongside Mr. Gordon in the McDarby case.

“This attitude of Merck — that we’re going to try every case — will destroy the company,” Mr. Lanier said. The history of complex corporate litigation, he said, shows that plaintiffs will become increasingly adept at presenting their cases, as they figure out which documents to highlight and witnesses to call.

Christopher Seeger, a plaintiffs’ lawyer in New York, said the New Orleans verdict was particularly stinging for Merck because it came in federal court. Corporate defendants generally prefer federal courts because judges tend to keep tight rein on lawyers and to impose stricter rules on what evidence juries are allowed to see.

Merck also received bad news yesterday in Atlantic City, where Judge Carol Higbee, who is overseeing 7,100 suits in New Jersey state court, threw out a decision in favor of the company reached in November.

In December, after the verdict, The New England Journal of Medicine published an “expression of concern” about the way Merck had reported the results of a large clinical trial of Vioxx in a paper published in the journal in 2001. According to lawyers for both sides, Judge Higbee said that jurors should not have had to consider the article without knowing that its editors believed that Merck had misrepresented the results of the trial.

The suit will be retried as part of a group of cases scheduled to begin in January.

Copyright 2006 The New York Times Company

FAIR USE NOTICE: This may contain copyrighted (C ) material the use of which has not always been specifically authorized by the copyright owner. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. It is believed that this constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. This material is distributed without profit.