Friday it was announced that a settlement has been reached for the majority of Vioxx litigation. Merck & Co. announced that they will pay just under $5 billion dollars to settle thousands of Vioxx injury cases. The settlement is not a class action settlement and each case will be reviewed before any payment is made. Merck will place the money into a fund, which will be petitioned for individually on behalf of plaintiffs groups. Merck says that they will set away $4 billion for those who suffered heart attacks and the additional $850 million will be used to compensate those who had strokes while taking the drug.
“In the big picture this is a bargain for Merck,” said Michael Krensavage, an analyst with Raymond James and Associates in New York who estimates Merck was spending about $600 million a year in legal fees. “The settlement is chump change compared to the initial fears that sent Merck shares into the $20 range.”
Vioxx was pulled from the market in 2004 after a study concluded it doubled the risk of heart attack in some patients. The settlement comes as a surprise to many, including me, as Merck had vowed to fight every case and having very good results doing so, winning 12 cases while losing only 5. However as a cost benefit analysis this has to be considered somewhat of a victory for Merck, whom some analyst estimated would pay out as much as $30 billion before all was said and done.
While this is not the nail in the coffin, it certainly is much closer to closure for many of those injured by this dangerous drug.
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