ANGLETON, Texas - A Texas jury found pharmaceutical giant Merck & Co. liable Friday for the death of a man who took the once-popular painkiller Vioxx, awarding his widow $253.4 million in damages in the first of thousands of lawsuits pending across the country.

There is something weird in this whole case. Merck removed Vioxx from the shelves after it was found that it "increases the risk of heart attacks". It was later returned to the shelves with an attached warning. So lets assume that the lawyers somehow proved that Vioxx was reponsible for the death of the man in question.

Doesn't $253mln appear *just a bit* too harsh ? It's a good few percent of Merck's yearly profits (the stock fell about 7% yesterday), and if really "thousands" of other cases are pending, this sound like something that can fold Merck.

The sum is astronomical. It's much more than the sums awarded to single cases in lawsuits versus cigarette companies, it just doesn't make any sense.
Now, I wonder, is this prudent ? A big pharma company whose drugs save millions of lives and ease the suffering of millions of others (the drug in question, Vioxx is a popular pain killer that certainly improved the life of many people). Is it normal / acceptable to destroy it in lawsuits due to an increased chance of one of its drugs to induce heart attacks ?

P.S. in this specific case the final sum is likely to be reduced to $26mln (still, quite a lot) since Texas limits the punitive damages in its lawsuits, but in other states there may be higher limits... Merck's stock reacted with a drop that reflects a $5.2 bln loss of market capitalization.


Comments

comments powered by Disqus