Merck ($MRK) is closing a chapter in its seemingly never-ending saga over the painkiller Vioxx, agreeing to pay more than $800 million to settle a lawsuit over the med years after the company pulled its product from the market and shelled out billions to resolve other suits.
The Kenilworth, NJ-based company will pay about $830 million to wrap up a multi-district class action lawsuit over Vioxx in a New Jersey federal court; it'll also hand over an additional amount to cover attorney fees and expenses. After insurance kicks in about $150 million, Merck said it will fork over about $680 million in cash. The company expects to record the charge in its Q4 2015 earnings, it said in a statement.
Merck, which still faces other individual securities lawsuits over Vioxx, said that the settlement "does not constitute any admission by Merck or any of the individual defendants of any liability or wrongdoing."
The plaintiffs in the class action suit bought stock in the company between May 21, 1999 and Oct. 29, 2004--before Merck pulled Vioxx from the market--and were trying to recover damages under federal securities laws for the company's statements regarding the drug.
The latest action adds to Merck's drama with Vioxx. In 2004, the company yanked the drug from the market after a study pointed to an increased risk of heart attacks and strokes. Since then, Merck has faced a deluge of legal pushback, including a federal probe into its marketing practices for Vioxx and consumer suits alleging fraud.
Merck has since wrapped up a good chunk of that litigation, but the settlements came at a price. In 2007, the company handed over $4.85 billion to settle an initial batch of suits. In 2011, the company agreed to pay $950 million to resolve allegations from the U.S. Department of Justice (DOJ) that it improperly marketed Vioxx. The next year, Merck settled a consumer class action suit over the med for $220 million.
- read the statement
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