With its stock price in free fall over fears of upcoming litigation related to Zantac, it’s damage control time for pharma giants GSK, Boehringer Ingelheim, Sanofi and Pfizer as well as a host of generic drug makers that marketed the heartburn medicine.
Thursday, one of those generic manufacturers, Perrigo, issued a statement to clarify its status in the first case heard in the U.S.—George Bayer vs. Boehringer Ingelheim, et al.—in which the plaintiff moved this week for a voluntary dismissal after being hospitalized.
Bayer alleges that taking Zantac caused his esophageal cancer. The drug was taken off the market in 2019.
Perrigo, which is one of 13 companies named in the suit, said it was dismissed from the case on Aug. 4. The Dublin-based company added that the dismissal was with “prejudice, meaning the plaintiff’s claims against Perrigo in that litigation cannot be refiled.”
Perrigo—along with other generic drugmakers Teva, Dr. Reddy’s and Sun Pharma—agreed to a combined settlement of $500,000, sources this week told Bloomberg.
Referring to an unnamed news report, Perrigo also pointed out that Bayer’s claim specifies that he purchased both brand-name Zantac and private label (generic) ranitidine as opposed to just the generic version.
Perrigo added that the company has obtained dismissals in “the majority” of ranitidine cases involving the company, including multidistrict litigation in California and Maryland.
“Importantly, there have been no material developments regarding ranitidine-related litigation to what has been previously disclosed,” Perrigo said in the statement. “The industry maintains strong defenses to such claims based on the body of scientific evidence, which indicates there is no causal relationship between ranitidine and cancer.”
With news of Perrigo’s settlement, the company’s stock price fell from $41.84 to $39.63 earlier this week. But it rallied to $40.47 on Thursday after the company clarified its status.
Taking a more dramatic fall has been GSK—which developed the drug—and its consumer health spinoff Haleon.
GSK’s share price has dropped from $40.31 to $34.70, while its market cap has taken a nosedive from $81 billion to $71 billion. Following news of the dismissal of the Bayer case, GSK’s value had a minor comeback, up from $70.3 billion earlier this week.
Meanwhile, Haleon’s stock has fallen dramatically, going from $7.49 per share on Aug. 8 to its current $6.12. As a result, the company’s value has declined by more than 20% over the period.
Sanofi’s share price declined from $49.08 to $41.06 since Aug. 8, while Pfizer’s fell much less significantly, from $49.95 to $49.02 over the last eight days. Boehringer Ingelheim is not a publicly traded company.
Earlier this week, Sanofi’s chief financial officer Jean-Baptiste de Chatillon told Reuters that the market reaction was exaggerated and that it represented a buying opportunity for savvy investors.
“There’s just a strong, strong disconnect,” de Chatillon said. “I think some people will see it, and some investors will say that they will come back.”