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N.Y. sues Merck over Vioxx prescription costs

September 18, 2007|From the Associated Press

New York city and state sued Merck & Co. on Monday, accusing the drug maker of defrauding Medicaid and other government insurance programs by hiding the risks of heart problems associated with its pain medication Vioxx.

The lawsuit, filed in state Supreme Court in Manhattan, said the state's Medicaid and Elderly Pharmaceutical Insurance Coverage programs had paid more than $100 million for Vioxx prescriptions since the drug went on the market in 1999.

For residents receiving Medicaid assistance, New York City paid a substantial share of those costs.

The lawsuit says tens of millions of dollars were paid for prescriptions for patients with preexisting heart conditions. Those funds would not have been spent had the risks associated with Vioxx been known, court papers say.

The filing was announced by New York state Atty. Gen. Andrew M. Cuomo and New York City Mayor Michael Bloomberg.

Merck, based in Whitehouse Station, N.J., removed Vioxx from the market Sept. 30, 2004, because it doubled the risk of heart attack and stroke.

Before stopping Vioxx sales, court papers say, Merck "undertook a concerted and tenacious campaign of false and fraudulent statements to minimize the import and seriousness" of the possible association between Vioxx and heart problems.

This "disinformation campaign" continued until a month before Merck ceased sales of the drug, causing New York doctors to write prescriptions for Vioxx that they otherwise would not have written, the lawsuit said.

Merck spokesman Kent Jarrell said the company researched and monitored the drug while it was on the market and voluntarily withdrew it when problems were suspected.

"We are confident that our behavior has been responsible," Jarrell said, adding that similar lawsuits seeking reimbursement for insurance costs had been filed in "a handful" of other states.

Merck faces almost 27,000 lawsuits from people claiming Vioxx caused heart attacks and strokes, but more than 1,170 cases have been dismissed. Of cases that have reached verdicts, Merck has won nine and lost five; a new trial was ordered in another case.

Merck shares fell 13 cents to $49.41 on Monday.

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