Even as Daiichi Sankyo makes deep cost cuts to offset revenues lost to generic versions of its blockbuster Benicar, the Japanese drugmaker has agreed to lay out $300 million to settle lawsuits tied to side effects of the blood pressure medication and several related drugs.
Daiichi Tuesday said it agreed to settle nearly 2,300 lawsuits for $300 million, assuming that at least 95% of defendants sign on to the deal, and if other thresholds are met.
The drugmaker didn’t admit liability and reiterated its belief in the safety of its products but Daiichi President Glenn Gormley said the company believes the settlement "is in the best interest of all."
The cases, which have been piling up since 2014, allege that Daiichi’s olmesartan products Benicar, Benicar HCT, Azor and Tribenzor, caused sprue-like enteropathy and other severe gastrointestinal symptoms. The FDA in 2013 approved a label change warning the drugs can cause intestinal problems.
Daiichi pointed out that most of the costs will be covered by its insurers, so the settlement will have no material impact on its finances.
Its finances certainly have been impacted, however, by losing patent exclusivity last year for the $2.6 billion seller. The drug accounted for about a quarter of the drugmaker’s revenues. Daiichi Sankyo has cut more than 1,200 jobs, many in the U.S., and closed some operations in Germany and in Japan.
To try to offset the sales vacuum, Daiichi is shifting away from primary care meds and toward specialty drugs such as its clot-fighting pill Savaysa, and Movantik, a constipation drug it markets with AstraZeneca.