TRENTON, N.J. — Drugmaker Merck & Co. will start cutting checks for former users of its withdrawn painkiller Vioxx next month, after announcing Thursday that it will fund a $4.85 billion settlement expected to resolve roughly 50,000 lawsuits alleging harm from Vioxx.
Whitehouse Station, N.J.-based Merck said more than 97 percent of eligible claimants have enrolled in the settlement program, surpassing threshold levels the company required for the deal to proceed. Therefore, Merck said that on Aug. 4 it will waive its right to walk away from the $4.85 billion settlement deal reached with plaintiffs’ attorneys last fall.
“This is a great day for the plaintiffs injured by Vioxx who will within weeks begin to receive compensation for their injuries,” said lawyer Chris Seeger, a member of the plaintiffs steering committee coordinating the massive litigation. “On a personal and professional level, I couldn’t be happier for my clients.” According to Merck, more than 48,500 of the roughly 50,000 //individuals with registered, eligible injuries have enrolled in the settlement program. Nearly all have submitted papers releasing Merck from further liability and documenting their use of Vioxx and medical care received as a result.
“This is an important milestone that shows the resolution program is on track,” Bruce N. Kuhlik, Merck’s general counsel, said in a statement.
Former Vioxx users, or their relatives, are eligible for part of the settlement if the patient suffered a heart attack, stroke or death. They also must have had pending lawsuits or tolling agreements, which suspend the statute of limitations, as of Nov. 9, 2007, the date the settlement was reached.
To ensure that the settlement ended the bulk of the lawsuits against Merck, the company had required participation from at least 85 percent of eligible claimants in four groups: those who had used Vioxx for more than 12 months, had a heart attack, had an ischemic stroke or died. Merck also required lawyers participating in the settlement to recommend it to all their clients and to stop representing any who wanted to instead continue to pursue a lawsuit.
Merck will make total payments of $4.85 billion into the settlement fund, with the first $500 million payment scheduled for Aug. 6. The company took a charge for the full $4.85 billion last year.
On top of that, Merck has spent at least $1.4 billion on legal costs for individual plaintiff trials, most of which it has won.
Eligible claimants who enrolled by March 31 and allege a heart attack or sudden cardiac death could then receive an interim payment, which would be 40 percent of their estimated total payment. Those initial payments are expected to be made by the firm administering the claims by the end of August.
Interim payments to people alleging Vioxx caused an ischemic stroke are to begin in or after February 2009.
The administrator, BrownGreer PLC, is continuing to verify documents submitted by claimants.
Merck withdrew Vioxx from the market on Sept. 30, 2004, after its own research showed the once-blockbuster arthritis pill doubled risk of heart attack and stroke.
In morning trading, shares fell 38 cents to $36.25.
