Settlements Covered by Previously Announced Third-Quarter 2010 Charge
WHITEHOUSE STATION, N.J.--(BUSINESS WIRE)-- Merck (NYSE: MRK), known as MSD outside the United States and Canada, announced it has reached a resolution with federal and state authorities regarding a previously disclosed investigation concerning Vioxx. Merck voluntarily withdrew Vioxx from the market in September 2004. The company previously recorded a charge of $950 million in October 2010 in anticipation of today's agreements.
Under civil settlement agreements signed with the United States and individually with 43 states and the District of Columbia, Merck will pay approximately two-thirds of the reserved charge to resolve civil allegations related to Vioxx. As a result, the United States and the participating states have released Merck from civil liability related to the governments' allegations regarding the sale and marketing of Vioxx in the United States. Previously disclosed litigation with seven states remains outstanding.
The civil settlement does not constitute any admission by Merck of any liability or wrongdoing.
"We believe that Merck acted responsibly and in good faith in connection with the conduct at issue in these civil settlement agreements, including activities concerning the safety profile of Vioxx," said Bruce N. Kuhlik, executive vice president and general counsel of Merck.
Separately, the company agreed to plead guilty to a misdemeanor under the Federal Food, Drug, and Cosmetic Act arising out of the marketing of Vioxx by company representatives to physicians in the United States for the treatment of rheumatoid arthritis before the FDA's approval of that indication in April 2002. The company will pay a fine of approximately one-third of the reserved amount to the federal government as part of the plea agreement.
As part of the plea agreement, the United States acknowledged that there was no basis for a finding of high-level management participation in the violation. The government also recognized Merck's full cooperation with its investigation.
Merck also has entered into a new corporate integrity agreement (CIA) with the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services. This agreement replaces Merck's current CIA and builds upon the company's existing comprehensive compliance program. Merck’s compliance program includes specific policies and procedures governing the company's interactions with healthcare professionals and is designed to help prevent, detect and resolve potential violations of company policy or law.
"Merck recognizes the importance of robust compliance programs and is committed to adhering to the law and to our fundamental values and standards. We believe that the settlement of this lengthy investigation is in the best interests of our stakeholders, and we look forward to focusing on our mission to save and improve lives around the world," said Kuhlik.
Today's Merck is a global healthcare leader working to help the world be well. Merck is known as MSD outside the United States and Canada. Through our prescription medicines, vaccines, biologic therapies, and consumer care and animal health products, we work with customers and operate in more than 140 countries to deliver innovative health solutions. We also demonstrate our commitment to increasing access to healthcare through far-reaching policies, programs and partnerships. For more information, visit www.merck.com and connect with us on Twitter, Facebook and YouTube.
Merck Forward-Looking Statement
This news release includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Such statements may include, but are not limited to, statements about the benefits of the merger between Merck and Schering-Plough, including future financial and operating results, the combined company's plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Merck's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.
The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the possibility that the expected synergies from the merger of Merck and Schering-Plough will not be realized, or will not be realized within the expected time period; the impact of pharmaceutical industry regulation and healthcare legislation; the risk that the businesses will not be integrated successfully; disruption from the merger making it more difficult to maintain business and operational relationships; Merck's ability to accurately predict future market conditions; dependence on the effectiveness of Merck's patents and other protections for innovative products; the risk of new and changing regulation and health policies in the United States and internationally and the exposure to litigation and/or regulatory actions.
Merck undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in Merck's 2010 Annual Report on Form 10-K and the company's other filings with the Securities and Exchange Commission (SEC) available at the SEC's Internet site (www.sec.gov).
Ron Rogers, 908-423-6449
Carol Ferguson, 908-423-4465
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INDUSTRY KEYWORDS: Health Pharmaceutical