Although a New Jersey jury spared Merck & Co. a double hit to the pocketbook, analysts are concerned that its negative findings on the marketing of Vioxx could continue to hurt the company as it defends itself against almost 10,000 lawsuits filed by users of the now-pulled arthritis drug.
Merck’s Achilles heel appears to be judgments that it failed to warn that Vioxx could cause heart attacks, lawyers and analysts said Thursday, a day after the jury gave a split verdict to two longtime Vioxx users who survived heart attacks.
However, Alan Klein, a lawyer who has defended another drug maker, said the outcome validated Merck’s strategy of handling the litigation case by case, rather than settling, and would prompt some people to drop their lawsuits.
“You have to be very careful as a defendant not to be writing checks left and right,” said Klein, who represented Interneuron in one of the first cases involving the diet drug known as fen-phen. “My own view is that a lot of the Vioxx claims are meritless.”
But Barbara Ryan, an analyst at Deutsche Bank North America, said with only a handful of Vioxx verdicts to date, it’s too early to draw firm conclusions.
“This is a marathon, and we’re sitting here analyzing the first few steps. I don’t think it’s going to tell you a lot,” Ryan said. “Each case will come out differently, even with the same facts. It’s just impossible to predict how this will play out. We have four data points out of 10,000.”
The jury in Atlantic City overwhelmingly found Wednesday that Merck failed to warn the public about the risks of Vioxx and that the New Jersey-based company intentionally suppressed information linking the drug to cardiovascular problems.
But the jury found that Vioxx was a factor in the illness of just one of the users, John McDarby, 77, of Park Ridge, and awarded him $4.5 million in compensation. The panel was considering additional awards for him on Thursday. It did not award significant damages to co-plaintiff Thomas Cona, 60, of Cherry Hill.
Chris Placitella, a Red Bank lawyer handling about 800 Vioxx cases, said he has spoken to 50 other plaintiffs’ lawyers since the verdict and all feel “it was a tremendous result.”
“Because the jury found, unequivocally, that Merck was liable. That they acted wrongly” in failing to warn consumers about the risks, Placitella said.
“This case had a lot more focus on the marketing of the product because of the evidence that was developed since the last case was tried,” he said, citing depositions taken from key Merck personnel.
That evidence, he noted, will be available for all cases yet to be tried.
Credit Suisse analyst Catherine J. Arnold said the verdict “does re-ignite investor concerns,” because more trials involving long-term users are scheduled this spring and cardiovascular risk has been proven for those taking the drug for more than 18 months.
In addition, she noted that even though McDarby had other risk factors-he was 75 and a diabetic when stricken-the jury still believed Vioxx contributed to his heart attack. Cona’s case may have suffered because of incomplete records on how long he used Vioxx, she said.
A.G. Edwards & Sons Inc. analyst Al Rauch said, “Considering that Merck lost to a plaintiff with a high number of risk factors and in its home state, this ups the ante for future cases.”
The jury’s ability to distinguish between the men’s claims should encourage Merck to continue handling cases individually, said Howard Erichson, a professor at Seton Hall Law School in Newark.
“What that shows is in mass tort litigation, even though there are big common questions, you still come down to individual issues such as medical causation,” Erichson said.
Lawyers representing other Vioxx users said they liked the verdict
McDarby is Merck’s “worst nightmare,” said Trent Miracle, an Illinois lawyer with about 150 Vioxx cases pending. McDarby had “serious contributing factors that could have caused his heart attack and the jury didn’t buy that.”
“That really opens up the pool of plaintiffs out there,” Miracle said.
