Wyeth, Fen-Phen Lawyers Propose New Settlement

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> JustSayNo

> Thu, 22 Jul 2004 21:28:46 -0400

> [sSRI-Research] Wyeth, Fen-Phen Lawyers

> Propose New Settlement

>

>

> Wyeth, Fen-Phen Lawyers Propose New Settlement

>

> Associated Press

> July 22, 2004 8:45 p.m.

>

>

>

http://online.wsj.com/article/0,,SB109054227392471843,00.html?mod==Health

>

> TRENTON, N.J. -- Former fen-phen users seeking

> compensation for heart problems under a national

> class-action settlement would get payments sooner

> but would receive less under a proposed new

> agreement between drug maker Wyeth and claimants'

> attorneys.

>

> The new agreement, announced Thursday, must be

> approved by a federal judge after some details are

> ironed out over the next couple weeks. It would

> affect about 41,600 former users of the diet drugs

> Pondimin and Redux who suffered moderate heart valve

> damage.

>

> Wyeth pulled the drugs, part of the once

> wildly popular fen-phen combination, from the market

> in September 1997 amid reports they had caused heart

> valve damage and, in a small number of users, a

> potentially deadly lung condition.

>

> " It is, I think, a great day for Wyeth and a

> great day for the claimants, " said attorney Jim

> Doyle of Houston, who helped hammer out the

> agreement and represents about 1,000 claimants in

> the class. " It does inject a lot of new money to

> take care of the plaintiffs and will help Wyeth put

> an end to this. "

>

> According to court documents, the deal

> requires Madison-based Wyeth to add $1.275 billion

> to the $3.75 billion trust fund it set up to cover

> the settlement. Wyeth has already reserved $16.6

> billion to cover the trust fund, legal fees, jury

> awards and out-of-court settlements, as well as the

> lung damage cases. Of that, only $3.3 billion

> remains, according to Wyeth spokesman Lowell Weiner.

>

> Some analysts have speculated that the

> long-running litigation could bankrupt Wyeth, which

> is appealing a $1 billion jury award in a Texas

> case.

>

> Kenneth Martin, Wyeth's chief financial

> officer, told analysts and investors during a

> conference call Wednesday that if the new agreement

> is agreed to and approved, " it is likely that

> additional reserves will be required. " Though he

> said could not estimate how much additional reserves

> may be needed, " the amount could be significant. "

>

> The new agreement is called the Seventh

> Amendment because it is the seventh change in

> provisions covering the class-action settlement

> originally reached in November 1999. Attorneys began

> hammering it out after both sides realized the trust

> fund would run out of money because there were more

> claimants than anticipated.

>

> Besides streamlining the evaluation process

> for those with moderate valve damage, the new

> agreement requires Wyeth to pay for heart valve

> replacement surgery needed by any of those claimants

> over the next eight years. Previous agreements made

> it unclear who would pay if a claimant needed

> surgery after settling a claim.

>

> " This Seventh Amendment would set up a more

> efficient process for dealing with the least serious

> but most numerous claims that are in our system, "

> Mr. Weiner said.

>

> Mr. Doyle said the payments to those people

> now would average about $68,000.

>

> The new agreement does not affect a couple

> thousand class members with the most serious damage

> -- those who have had or need valve surgery, have

> suffered serious complications such as stroke, or

> have died.

>

> The agreement does not affect people suing

> individually or the 3,120 class-action members

> already paid a total of $1.21 billion.

>

> Heart valve damage is a progressive disease,

> initially causing shortness of breath and fatigue

> because the weak valve lets blood flow back into the

> heart instead of through the body. Eventually, some

> people need a new valve.

>

> Wyeth and numerous lawyers representing both

> the class-action group and claimants suing

> individually reached the agreement late Wednesday,

> the day a 2 1/2-month hold on payouts under the

> class-action settlement was to expire.

>

> On Thursday, U.S. District Judge Harvey Bartle

> III in Philadelphia agreed to a motion by the

> attorneys to extend that hold until Aug. 4, while

> the attorneys work out wording of documents related

> to the agreement. Those include a notification form

> to explain the latest changes to claimants.

>

> 2004 Associated Press

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