Million-Dollar Setback for Merck in Vioxx Cases

Merck suffered two major setbacks Thursday in the product liability litigation over its painkiller, Vioxx. In one case, a jury awarded $51 million to a retired FBI agent who suffered a heart attack after taking the drug. In the other, a judge threw out a decision that had favored Merck, with a retrial ordered for next January.

The company faces some 16,000 Vioxx lawsuits in state and federal courts. It withdrew Vioxx from the market in 2004 after a study showed that the drug doubled the risk of heart problems.

A huge award in federal court. Jurors gave the plaintiff, Gerald Barnett, $50 million in compensatory damages. They found the company had "knowingly misrepresented or failed to disclose information" about Vioxx to Barnett's doctors and was negligent in warning them about its risks. The doctors testified they wouldn't have prescribed Vioxx to Barnett had they known it could cause heart attacks. Jurors also awarded Barnett, 62, punitive damages of $1 million, saying Merck "acted in wanton, malicious, willful or reckless disregard for the plaintiff's rights." Barnett suffered a heart attack in 2002. His was the ninth Vioxx case to go to trial and the fourth loss for Merck, which says it will appeal.

The verdict is the second largest against Merck. The largest award was in a Texas state court last year, where jurors awarded $253.4 million dollars to the widow of a man who suffered a fatal heart problem after taking Vioxx.

The case pitted one of the most prominent defense lawyers in the country, Philip Beck of Bartlitt, Beck of Chicago, against a well-regarded plaintiff's lawyer, Mark Robinson of Robinson, Calcagnie & Robinson. In an interview, Robinson praised Beck’s "incredibly meticulous" defense of Merck. To win these cases, he said, plaintiffs' lawyers "are going to have to work really hard. You have to know every page of every transcript, every document and every medical record. There are hundreds of studies, and thousands of exhibits. It's a very intense battle."

For his part, Beck, told reporters in a conference call that he felt he had presented a good case but added, "I’ve been doing this long enough to know that juries can’t be predicted." Beck defended Merck in the only other Vioxx case to be tried in federal court. Merck won that case.

Beck said he would ask Judge Fallon to set aside the jury verdict. Failing that, he said he would ask for a reduction in damages because the $50 million in compensatory damages "bears no relationship to the evidence of harm that was put in." The plaintiff said his medical bills came to about $150,000. If neither strategy proves effective, Beck said Merck would appeal the verdict to a higher court. That process could take up to two years.

Merck's loss in New Orleans is especially surprising because federal judges and rules of evidence are more sympathetic to such cases than are the judges and rules of state courts. Three more federal trials are scheduled this year. Each side takes turns choosing cases. This case was chosen by plaintiffs’ lawyers. Merck chose the next case to be tried; it will begin in New Orleans on Sept. 11.

A surprising reversal in New Jersey. In the other major development of the day, Judge Carol Higbee of New Jersey Superior Court threw out a November 2005 verdict that had favored Merck. The judge ordered a January retrial in the case of postal worker Frederick "Mike" Humeston, who had a heart attack in 2001 after taking Vioxx for two months. Merck says it is now "considering its legal options."

The judge based her decision on the "Expression of Concern" published by the editors of the New England Journal of Medicine in December 2006. In it, editors of the Journal said the authors of a crucial Vioxx study, including Merck employees, had misled the Journal about Vioxx’s cardiovascular risks as seen in a large scientific study called VIGOR. They said the risks of Vioxx were greater than the paper had indicated The study was conducted in 1999 and 2000; the paper was published in 2001.

The judge's ruling was "really aggressive," said Howard Erichson, a professor at the Seton Hall Law School. He said it was uncommon for judges to retry cases on the basis of new evidence, noting that "it's the sort of decision that a judge is unlikely to make unless the judge is concerned that injustice was done." That has to worry Merck, Erichson added, because thousands of Vioxx cases are consolidated under Higbee.

But, Erichson said, Vioxx litigation is still evolving, and Merck’s setbacks today don’t predict the ultimate outcome.

The judges in both courts are poised to play important roles as the cases move forward. Thousands of Vioxx cases are consolidated under U.S. District Judge Eldon Fallon, and separately, under Judge Carol Higbee of New Jersey Superior Court. Both judges have said they’re interested in bringing the two sides to settlement talks. Merck insists it is committed to defending each case in court.

Merck’s stock fell almost six percent on the day’s news to close at $38.83.

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