Questions and Answers on Vioxx

[Guest guest]

Do not depend on medicine for health. Read the story on Vioxx at http://www.businessweek.com/ap/financialnews/D8SQN5S00.htm

Lokesh

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Three years after withdrawing its blockbuster painkiller Vioxx from the market and vowing to fight every lawsuit claiming users got heart attacks and strokes, Merck & Co. agreed to pay $4.85 billion to settle some 60,000 cases.

 

Here are questions and answers about the settlement announced Friday:

Q: What is Vioxx?

A: Vioxx was a popular prescription drug, often taken to treat arthritis pain. Whitehouse Station-based Merck pulled it from the market Sept. 30, 2004 after its researchers determined the drug doubled the risk of heart attacks and strokes. At the time, Merck sold $2.5 billion worth of Vioxx a year.

 

Q: What was settled, and for how much?

A: Merck agreed to pay $4.85 billion to people who sued by Nov. 8, 2007, and can prove they had a heart attack or stroke after using Vioxx.

Q: How much do attorneys get out of the settlement?

A: About one-third of that money, or $1.6 billion, will go to lawyers who worked on the cases for Vioxx users. Shares for the lawyers would vary depending on agreements with their clients.

Q: How much will people who sued Merck over Vioxx get?

A: That depends on the severity of their heart attack or stroke, when the injury happened, Vioxx usage, and whether they had risk factors such as smoking or obesity.

Q: If someone used Vioxx and didn't sue, can they seek a piece of the settlement money?

A: No.

Q: What about people who either won or lost at trial already?

A: Those who have lost can drop appeals and join the settlement. Those who have won must decide whether to take a chance on the awards withstanding Merck's appeals, or join the settlement and get a sure thing. In the cases that went to trial, Merck prevailed in 10 of 15 verdicts and was appealing the losses.

 

Q: How does a plaintiff join the settlement?

A: They don't need to do anything yet. They will be contacted by their lawyers and given an estimate of their award. They can then decide whether to join the settlement or pursue their lawsuit.

Q: What happens if a person who sued doesn't want to be a part of this settlement?

A: They can pursue their lawsuit in the courts. They may have to get a new lawyer, however, since many of the lawyers represent dozens of claimants and would probably stick with the guaranteed payouts from the settlement.

 

Q: Is the settlement a done deal?

A: No. At least 85 percent of the eligible claimants must decide to participate for the settlement to take effect. The deal has already been endorsed by the four judges who were presiding over the bulk of the 60,000 cases pending against Merck.

 

Q: Why did Merck settle?

A: The company said the deal would provide compensation for Vioxx injuries and avoid years of litigation. Merck also gets to put a price tag on the cost of Vioxx and end the uncertainty of jury verdicts. Merck had originally said it would fight every case individually.

 

Q: Did Merck admit guilt?

A: No. As is typical in settlements, Merck did not admit any wrongdoing.

Q: What happens next?

A: After plaintiffs decide whether to participate, their lawyers have until March 1 to submit documents to the settlement administrator. Payments would not be expected until April or later.

Q: How did news of the settlement affect Merck stock?

A: Shares in Merck rose $1.13, or 2 percent, to close Friday at $55.90, near its 52-week high of $58.36. Shares had traded in the $45 range before Merck pulled Vioxx from the market in 2004, but soon slumped toward $25.