Merck & Co. has offered to pay US$4.85 billion to end litigation with thousands of U.S. plaintiffs over its painkiller Vioxx.
The agreement applies only to U.S. legal residents and those who allege that a heart attack or stroke they experienced while taking Vioxx occurred in the United States.
In Canada, negotiations continue in a number of class-action cases against the makers of Vioxx.
Mike Peerless, of Siskinds LLP, a law firm that represents hundreds of Canadian plaintiffs in Vioxx class actions, tells CTV that the settlement in the U.S. is a good sign and suggests that the company will want to quickly settle its Vioxx cases in Canada.
The offer in the U.S., made on Friday, is believed to be the largest drug settlement ever. To become binding, 85 per cent of the plaintiffs in about 26,600 lawsuits must agree to drop their cases.
Lawyers for the drug company and for the plaintiffs reached the deal in the early-morning hours following a meeting with three of the four judges overseeing nearly all Vioxx claims.
"I'm very happy with it," said Chris Seeger, one of the six plaintiff lawyers who helped negotiate the settlement. "It's a tremendous way to resolve this litigation."
He will recommend that his 2,000 clients accept the deal.
Merck took Vioxx off the market on Sept. 30, 2004 after its own research showed the drug doubled the risk of heart attacks and strokes.
Under the agreement, Merck will set up two funds: a $4 billion fund for claims from those who experienced heart attacks while taking the drug; and an $850 million fund for those who suffered strokes. The amount awarded to individual plaintiffs will vary.
The company said it does not know the number of plaintiffs covered by the agreement.
Merck also says that the agreement states that the settlement is not an admission of "causation or fault." It says it will continue to defend all claims not included in Friday's agreement.
Merck faced personal-injury lawsuits representing 47,000 patients, plus about 256 potential class-action cases from patients and family members who claimed the drug either injured them or proved fatal.
Analysts had predicted the company could be liable for up to $50 billion.
Merck, however, has won 10 of 15 court verdicts to date. Settling removes the uncertainty hanging over the company, which had set aside $1.92 billion for legal expenses as of Sept. 30.
Seeger said all claimants will be compensated once their claims are validated. In order to be validated, patients must:
- Provide objective, medical proof of a heart attack or stroke
- Provide documented receipt that they took at least 30 Vioxx pills
- Provide proof to show they took Vioxx within 14 days before the claimed injury
Payments will vary depending on the severity of injuries and the length of time the individual used Vioxx.
Vioxx was approved to relieve arthritis and other types of pain and was a member of a class of drugs called cox-2 inhibitors.
Another cox-2 inhibitor, Bextra, was forced off the Canadian market in April 2005 when it was shown to be linked to an increased rate of a rare but life-threatening skin condition, in addition to having heart risks.
Another cox-2, Prexige, was approved for sale in Canada in November 2006. But less than a year later, Health Canada halted its sales due to the potential for serious liver problems in people taking the drug.
Celebrex, another cox-2 approved for sale in Canada in 1999, is still sold in Canada.
With files from The Associated Press
