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Merck: Vioxx Settlement

Merck & Co. announced last week that they are settling third-party claims related to Vioxx. These are not the personal injury cases (cases by patients and their loved ones for heart attacks or other Vioxx injuries, most of which have already been settled for $4.85 billion), but rather these are lawsuits by unions and insurance companies against Merck, claiming that they overpaid for Vioxx in light of the drug’s risks.
The settlement, which has not been finalized but has been agreed to in principle, pays $80 million to settle 190 claims about the recalled drug. The document disclosing the settlement, Merck’s filing with the U.S. Securities and Exchange Commission, also revealed that the SEC’s formal probe of Merck surrounding Vioxx has ended. There are still outstanding third-party claims not involved in this settlement.
These third-party claims do not see a lot of play in the press. They are “faceless” claims by states, insurance companies, and other payers, none of whom suffer serious personal injuries. They are, however, becoming an invaluable component of drug litigation. It is one more hurdle for drug companies who put out dangerous drugs, and one more way to make sure the bottom line for defective or negligently marketed drugs is not as high as it otherwise would be. And, these are damages to taxpayers and members of insurance plans—one more reason we all have higher taxes and higher premiums.

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