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BY OUR PHARMA CORRESPONDENT
25 August, 2005: Lawyers in the US and the UK are reportedly shaping roughly 4,200 lawsuits to take on Merck. The recent Vioxx verdict could also influence a plethora of lawsuits already in wait claiming compensations from Merck, according to analysts.
The US-based pharmaceutical giant had lost in the landmark first Vioxx case when an US court found the COX-2 painkiller was a cause of death of a Texan and ordered Merck should pay damages of $253m.
As Merck is bracing itself for a swathe of lawsuits, attention is focusing on what the company's legal costs for Vioxx will eventually be and whether it needs to rethink its defence strategy as well as the broader implications for the industry.
Analysts predict a range of potential liability for Merck. Credit Suisse First Boston analyst Catherine Arnold doubled her liability estimate to $10bn, based on an assumption that 48,000 US patients will sue and may win payments averaging $200,000 each.
Another analyst at Friedman Billings Ramsay, raised his own estimates for the eventual bill from $11bn to $50bn, saying that the speed with which the jury came to a decision would encourage lawyers to file more claims.
However, some analysts on Wall Street said Merck was still well-positioned to deliver investors a dividend for years to come, despite the setback.
Vioxx was withdrawn last year after it was found to increase the risk of heart attacks and strokes in users who had taken it for more than 18 months. Merck has since faced allegations that it knew about the risk but suppressed negative data about the pill.
However, the drug maker has been maintaining that there is no reliable scientific evidence that shows Vioxx causes cardiac arrhythmias, which the autopsy showed was the cause of the man's death. Merck acted responsibly, from researching Vioxx prior to approval in clinical trials involving 10,000 people, to monitoring the medicine while it was on the market, to voluntarily withdrawing the medicine when it did.
Merck's defeat could pave the way for thousands of UK citizens to take action against the company. Almost 500,0000 Britons took Vioxx before it was withdrawn from the market in September 2004.
Britian's MSB Solicitors in Liverpool said it was working with around 150 British plaintiffs intent on suing Merck in its home state of New Jersey, after news of the Texas verdict. Partner at MSB, Gerard Dervan said it made sense for UK plaintiffs to fight Merck in the US courts, since the British government had so far decided not to provide legal aid.
BY OUR PHARMA CORRESPONDENT
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