Merck Settles Class Action Lawsuit Regarding Vioxx
Merck required to pay $830 million in damage recovery related to discontinued arthritis drug.
Pharmaceutical developer Merck announced it has reached a settlement agreement in an ongoing class action lawsuit regarding the drug Vioxx.
The multi-district suit In re Merck & Co., Inc. Securities Litigation was pending in the New Jersey federal court system. Plaintiffs in the suit were seeking damage recovery for Merck securities purchased between May 21, 1999 and October 29, 2004, inclusive, and individuals who sought to recover damages under the federal securities laws for specific statements by the manufacturer concerning Vioxx.
In the settlement, Merck will be required to pay $830 million to resolve claims and additional fees for attorneys and expenses.
After the use of funds from certain insurance policies, Merck’s cash payment will be about $680 million. The company will record a charge in the fourth quarter of 2015 and is excluded form non-GAAP results.
Merck is still facing other previously disclosed security lawsuits regarding Vioxx. The nonsteroidal anti-inflammatory drug was approved in 1999 for treatment of osteoarthritis and menstrual pain, before later being approved to treat the signs and symptoms of rheumatoid arthritis.
The drug was discontinued in 2004 after a study confirmed Vioxx increased the risk of cardiovascular problems, including heart attack and stroke. At its height, Vioxx was used by 2 more than 84 million people worldwide, according to Merck.