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Verdict Bolsters Merck's Vioxx

A New Jersey jury finds the drug didn't cause a woman's heart attack, boosting the company's case in similar suits.

July 14, 2006|From Bloomberg News

Merck & Co. won a victory in New Jersey on Thursday when a jury ruled the drug maker's Vioxx painkiller wasn't a cause of a 68-year-old woman's heart attack, strengthening the company's position in about 16,000 similar lawsuits.

Jurors in a state court in Atlantic City found Vioxx wasn't a "substantial contributing factor" to Elaine Doherty's heart attack in 2004. Merck adequately warned Doherty's doctor of the drug's risk and didn't defraud consumers, jurors said. The company lost one ruling when jurors said Merck didn't warn Doherty herself of the drug's risks.

"If I were a plaintiffs' attorney sitting on the fence, I would certainly be daunted by this verdict," said Mike Kelly, an attorney at McCarter & English who represents drug makers.

Merck, the No. 4 U.S. drug maker, won two earlier trials and a split verdict in a third. The company lost three Vioxx verdicts totaling $298 million, which will drop to $48 million because of state punitive damages limits. Merck allocated almost $1 billion for Vioxx litigation and vowed to fight every case.

"This really reinforces our strategy of trying every case," said Merck attorney Jim Fitzpatrick of Hughes Hubbard & Reed. "We made the appropriate safety disclosures to doctors, and we demonstrated that Vioxx did not cause Mrs. Doherty's heart attack."

Some analysts said Merck eventually would have to reach a global settlement of Vioxx litigation. Thursday's verdict will help any such effort, said analyst Steve Brozak of WBB Securities in Westfield, N.J.

"The thing shareholders fear the most is there is no settlement that is financially suitable for Merck," Brozak said. "Every time they are able to win in court, that settlement price goes down."

Shares of Whitehouse Station, N.J.-based Merck rose 24 cents to $36.94. They have risen 16% this year.

Merck withdrew Vioxx when a 2004 study showed it doubled the risk of heart attacks after 18 months of treatment. Merck blamed Doherty's heart attack on her age, weight, diabetes, cholesterol, blood pressure and clogged arteries. Doherty, who is 5 feet 3, once weighed 265 pounds and has been a diabetic for years.

"We simply believed that the risk factors were too insurmountable," juror Joseph Calabrese, 43, told reporters.

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