Merck & Co Stops Vioxx Rot with Unexpected Legal Victory

Who'd Have Thought it?

U.S. drug giant Merck & Co confirmed yesterday in a press release and conference call that it had emerged victorious in the seventh outcome from litigation relating to its withdrawn arthritis drug Vioxx (rofecoxib). The trial was conducted in the New Jersey Superior Court, in front of Judge Carol Higbee, and concerned a product liability claim levelled by 68-year-old Elain Doherty, who suffered a heart attack in January 2004 after taking Vioxx for two years. Crucially, Merck was cleared on both the product liability claim - the claim that Vioxx caused the plaintiff's heart attack - as well as the consumer statute. Thus, Merck was found to have properly disclosed all of Vioxx's risks to doctors; interestingly, however, it was found in a 7-0 verdict to have the failed to warn the consumer herself.

The conference call focused on this latter issue, and whether it has particular relevance for future Vioxx litigation. The fact that Merck was found to have properly disclosed Vioxx's risks to prescribers but not consumers is entirely unprecedented, and the defence team noted that they had no idea that this had been put forward as a claim in the case. As a result, Merck did not put up a defence on this issue, and it is a somewhat curious footnote to the verdict, particularly as Vioxx was an prescription-only drug that was not available in supermarkets. Still, it is just that - a footnote - and does not bear any relevance to, or cast a shadow over, Merck's overall liability. Clearly, if this is stated as a claim in future cases, Merck will be able to put forward significant direct-to-consumer (DTC) evidence to hold up its defence; indeed, it is not entirely clear whether this should be on the verdict sheet at all.

Outlook and Implications

The outcome of the Doherty case could prove to be the most significant Vioxx victory so far, as it throws the whole 18-month use issue wide open. Plaintiff attorneys have long tried to perforate Merck's contention that Vioxx is only proven - to a statistically significant extent - to be dangerous after 18 months of regular use. Recent changes and amendments to the New England Journal of Medicine (NEJM) article relating to the APPROVe trial, which resulted in Vioxx's withdrawal in September 2004, appear to have backed up these claims, or at least to have clouded the defence's contention. However, the Doherty case has turned the issue on its head and raised the importance of pre-existing risk factors. In most cases so far - even those that Merck has won - the issue of pre-existing risk factors has often been obscured, and unrelated issues such as the credibility of the plaintiff or jury sympathy have been more important. Once the importance of pre-existing risk factors has been raised, Merck stands on much stronger ground, as the vast majority of Vioxx users (ie, arthritis patients) will be older people, often diabetics, with other factors such as smoking or exercise coming strongly into play.

Indeed, Global Insight sees the verdict as a major - if surprising - positive for Merck. It is also particularly well-timed, as it coincides nicely with an upsurge in Vioxx cases coming to trial during the rest of this year. In the conference call, Merck immediately related the outcome to the ongoing California trial, the final verdict from which has been delayed to the end of this month or early-August. This case involves plaintiff Stewart Grossberg, who was admittedly prescribed "intermittent" Vioxx use. Still, the odds are again stacked against Merck in this case, as it takes place in another "judicial hellhole", not entirely unlike the Starr County case concerning Leonel Garza; the jurisdiction was perceived as such by the American Tort Reform Foundation (ATRF), in a 2005 assessment of areas in which "the scales of justice are radically out of balance" in favour of plaintiffs.

Whatever the outcome, Merck's four victories so far punch a hole in the litigation strategies of plaintiff lawyers, and clearly vindicate its case-by-case strategy so far. The company is successfully avoiding a debacle akin to that faced by American Home Products (now Wyeth) over the "fen-phen" diet drug combination, and we maintain a liability outlook of around US$10-15 billion - roughly half of apparent market expectations. The stock market has again reacted cautiously to the latest verdict, but this is clearly a highly significant outcome; Merck has not had any good Vioxx news for several months, and even then it was mixed blessings in the split verdict from the Cona/McDarby case. This is an outright victory, and, coupled with the strong chances of success on appeal against the Vioxx defeats, Global Insight sits more comfortably with Merck's prospects in 2006 in terms of its liability outlook.

Related Articles:

• United States : 27 June 2006: Pharma-Journal Community Polarises Further, as Merck & Co Deflects New NEJM Accusations
• U nited States : 24 April 2006: Merck & Co Suffers Vioxx Defeat in 'Judicial Hellhole'
• United States : 6 April 2006: Verdict in Joint Vioxx Trial Fails to Clarify Outlook for Merck & Co