The Vioxx wars

In the aftermath of Merck pulling the painkiller Vioxx from the market two years ago, 10 personal injury lawsuits have reached a verdict, with decidedly mixed results for the drug maker.

After losing a $235 million verdict in the first trial in August 2005, the company has gone on to win six of the 10 trials to date, including a defense verdict reached Sept. 26 in a U.S. District Court in New Orleans. (For a summary of the verdicts, go to the “Important Documents” section of our website.)

With more than 20,000 cases still pending, and Merck vowing to continue its strategy of trying them one at a time, both sides claim to be optimistic about future litigation.

“The litigation is a long road and there are a lot of challenges, but we’re feeling we have a very strong story to tell that clearly resonate with jurors,” said Theodore V.H. Mayer, a partner at Hughes Hubbard & Reed in New York and member of the Merck defense team. “We’re feeling really positive.”

As for the four plaintiffs’ victories, Mayer said those cases are far from over, noting the company is contesting all four.

“No appellate court has ruled on any of those cases yet,” he said.

But plaintiffs’ attorneys are feeling equally positive about their prospects.

“These are good cases and if they want to keep trying them, we’re happy to do that,” said John Boundas, the plaintiffs’ lawyer in the most recent loss to Merck.

Boundas estimated his firm, Williams Bailey in Houston, has approximately 1,000 Vioxx suits pending.

“Even if Merck wins half of the cases, when they lose, they lose big,” he said. “And in the meantime, they spend millions defending each case, which on average means they are losing money.”

Seton Hall University Law School professor Howard Erichson said while the most recent verdict gives the defense momentum, Vioxx litigation is still in flux.

“The litigation is still maturing and it’s an unpredictable environment for both Merck and the plaintiffs’ lawyers,” he said. “The real message of the back-and-forth verdicts is that it’s still too soon to seriously explore wholesale settlement negotiations.”

Of the 20,000 individual cases still pending, approximately 13,624 are in state court in New Jersey and 6,650 are part of a multi-district litigation in federal court in New Orleans.

The latest defense win

Robert Garry Smith, a 57-year-old Kentucky chemical plant maintenance supervisor, had been on Vioxx for just over 4 months when he suffered a heart attack in February 2003.

He filed suit, alleging the drug caused his heart attack and the company hid its knowledge of the health risks associated with Vioxx.

Merck countered that Smith’s heart attack was caused by other factors, such as high cholesterol and high blood pressure, as well as strenuous activity like shoveling snow.
After deliberating for just three hours, a federal jury of six women and two men in New Orleans found for the defense.

Boundas acknowledged his client had other health risks, but argued “very few people are going to be without any risk factors for a heart attack.”

He also noted this was a case which Merck picked to go to trial as part of the federal multi-district litigation in New Orleans.

“If this had been a case [the plaintiffs] had chosen and we lost, it would have been devastating,” he said. “But this case was handpicked by Merck.”

This was also the first case tried involving a plaintiff who took Vioxx after the drug’s label was changed to indicate that it might cause heart attacks.

Boundas said his client was very disappointed, but that they were still considering appellate options.

“We were really surprised,” he said. “The evidence that Vioxx causes heart attacks is overwhelming, and that Merck knew about it.”

One case at a time

Experts said while Merck’s strategy of trying individual cases may be expensive, it will continue for now.

“The Smith verdict will encourage them to continue their strategy,” Erichson said. “And given how evenly split the litigation seems to be at this point, it’s hard to see the cases settling any time soon.”

Mayer confirmed that the company has no plans to settle cases.

“We continue to address each case individually and remain steadfast in that strategy,” he said.

Down the road, however, settlement talks may be in the cards.

“The problem they are going to have is volume,” Boundas predicted. “They can defend a case here and there, but if the trials pick up and they start having five or 10 cases a month, I don’t think they can continue.”

Erichson said settlement would only become an option when the case outcomes become more predictable.

While the results so far have been mixed, so have the types of cases. The plaintiffs come from different backgrounds, have different risk factors and have taken Vioxx for different amounts of time.

“Juries really do care about individual causation,” Erichson said, pointing to the pair of cases tried in New Jersey in April, where the same jury awarded more than $13 million to John McDarby, a 77-year-old man who suffered a heart attack after almost four years on Vioxx, and then found for the defense in the case of Thomas Cona, who had a heart attack after approximately two years on Vioxx.

“Mass tort litigation often reaches a point where the parties are familiar enough with the issues, and the outcomes are predictable enough, [that they are willing] to negotiate an aggregate settlement or to negotiate a series of settlements with reasonably predictable values,” Erichson said. “Vioxx just isn’t there yet, because the outcomes are still all over the map.”

Nor is Merck’s liability confined to individual suits. Erichson noted that the company faces a class action filed by its shareholders in federal court in New Jersey and that state court Judge Carol Higbee recently certified a class action of various health insurers and other third-party payers. Health plans, including an engineers’ union in New Jersey, filed suit to recover money they paid to their members for Vioxx prescriptions.

The insurers argue that Merck violated New Jersey’s Consumer Fraud Act by concealing the side effects of Vioxx from the public and regulators, and that they would not have paid for the prescriptions if the drug’s side effects had been known.
With the trial scheduled for March, Merck has appealed class certification, with the case pending before the New Jersey Supreme Court.