Merck takes tough stance on Vioxx

Merck may have had a near-death experience, but now it's found a survival strategy: fight every Vioxx case as if it were the only one. Merck hasn't shelled out a penny of awarded damages--just $1 billion in legal fees as it takes every single plaintiff to court. (That may sound like a lot, but experts estimated the company's Vioxx-related liability at $25 billion after the scandal broke.) Never mind that Merck's own internal documents show that the company knew Vioxx could cause heart attacks and other cardiovascular catastrophes, years before the information went public. Never mind that several plaintiffs have won their cases against the company. With each new trial, the company has a clean slate. And if and when damages are awarded, it's on to the appeals courts.

With a backlog of some 45,000 Vioxx cases, the overloaded court system will take years to process them all. Some plaintiffs, experts say, won't follow through because they know Merck will fight. The wait-them-out approach appears to be working for the company; it's winning many of the suits, and its stock has rebounded some 80 percent since the first Vioxx-related verdict--and its $253.5 million in damages--two years ago. Do shareholders care that the widow in this case won't get a check until 2010 at the earliest, and that the most she'll get is $26.1 million? Hmm. Something to ponder.

- read the article from The New York Times

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