Vioxx manufacturer Merck & Co. scored a major legal victory yesterday as the New Jersey Supreme Court rejected a potential class-action lawsuit against the company. Class-action litigation would have probably resulted in Merck paying out around $20 billion before all was said and done. The court overruled two lower court decisions, deciding that a nationwide class-action suit was not the proper method of handling this issue.
The claims were brought forth on behalf of insurance companies that paid for prescriptions of the drug that was pulled from the market due to excessive cardiovascular risks. Insurance companies seek to recoup the money that they spent on the drug, which accounted for about 80 percent of all Vioxx that was sold. Merck just would not give up in this case, continuing to appeal decision after decision and has dodged the bullet for now.
Claims must now be settled on an individual basis and Merck believes that they will fair much better in this type of format. There will still be a huge cost paid by the manufacturer; however, it will likely only be a fraction of what it would have cost them in the class-action arena.
Beisner, the Merck lawyer, said the drugmaker has “very good” prospects for winning any individual suits filed by health plans because they had adequate information about the drug’s risks.
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