"Merck must be held legally responsible for its actions," Mr Hevesi noted in his press release. "These actions have put lives at risk and cost shareholders billions of dollars."
Experts say that for Merck's "no pay" strategy to work, the company would have to win virtually every one of the of individual lawsuits and then hope that such success would help defeat the claims by state health care programs, and the insurance and healthcare plans. Which they say is absolutely impossible because Merck has already admitted that consumers who used Vioxx over 18 months were exposed to an increased risk.
Billion dollar awards could easily drain Merck's insurance coverage and punitive damages based on evidence that shows the company withheld, manipulated, and misrepresented the results of clinical studies, and therefore willfully marketed Vioxx, are not covered by insurance and must be paid by Merck directly.
"I do think that Merck will get burned over this one," he says, "if their lawyers are dumb enough to fight each personal injury case."
Even though insurance does not cover punitive damages, Mr Turner says, "personal injury litigation costs are factored into so called R&D and marketing costs and the end user price covers all of this money."
"But the securities actions are different," he says. "Anyone who thinks this strategy is going to help the stockholders is crazy," he warns.
He predicts that Merck will soon start trying to settle PI cases with confidentiality clauses. "This would mean less payouts," he says, "and less knock on effect as other plaintiffs and their lawyers stand by to watch the action before running their own cases."
The fact is, that in every new trial, the lawyers for the plaintiffs introduce more embarrassing evidence. For instance, in a California trial that began last week, a former Merck employee, testified that the company did not inform federal authorities about two clinical trials in which users of Vioxx were found to be more likely to die than people given a placebo.
Dr Edward Scolnick, the former head of Merck's research laboratories, said in a videotaped deposition played for the jury, that he did not believe the numbers were coincidental. "It's not likely due to chance," he said.
Dr Scolnick testified that people on Vioxx died at a rate 4 times higher than those who didn't receive the drug in one trial, and the rate was 2 ½ times higher in the other. Both studies were done in 2001 to see if Vioxx could help Alzheimer patients.
He said Merck did not turn over results to the FDA when company officials met with an FDA representatives in April of that year and that he was not aware of the trial results at the time.
The juries have also viewed internal documents that show Merck training its sales reps to avoid answering tough questions from doctor's about the adverse effects of Vioxx on the heart. In one training manual, each of the last four pages of potential questions that doctors might ask, the manual said "DODGE!" to avoid answering.
In the first trial in Texas, the plaintiff's attorney, Mark Lanier, presented documents showing that Vioxx sales reps at one time received a $ 2,000 bonus if one of the doctors they met with prescribed Vioxx more than 55% of the time, and that the rep was paid another $2,000 if the rate exceeded 61%.
Mr Lanier also showed the jurors a Merck SEC filing that said Merck's CEO Gilmartin was making about $3 million in salary and bonuses in 2000, when the company received the results of the clinical study in which Vioxx users suffered 5 times as many heart attacks as those taking naproxen.
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