Third jury rules against Teva, Baxter in hep C suit

A third Nevada jury has ruled against Teva Pharmaceuticals ($TEVA) and Baxter International ($BAX). The panel ordered the two companies to pay $14 million for selling large vials of propofol, an anesthetic injection blamed for a hepatitis C outbreak at a Las Vegas colonoscopy center. But a bigger award could be coming: The jury is considering punitive damages today.

The jury found that Teva and Baxter units shouldn't have sold the vials, which were large enough to allow reuse on more than one patient, raising the risk of infection. They were also more profitable, the plaintiffs' lawyers have said. The companies have argued that, used properly, the large vials are perfectly safe. But so far, all three trials have gone against the companies, with compensatory damages in the tens of millions and punitive damages of hundreds of millions.

As it has in the other cases, Teva says it plans to appeal the third jury verdict. In this case, the jury awarded the patient who contracted hepatitis, Michael Washington, and his wife $7 million each. The lawyers had asked for $5 milion each.

McKesson ($MCK), a drug distributor, was not named in the Washington case, though it was party to the second suit. Teva has agreed to pay all the damages arising from the Nevada litigation; some 300 lawsuits remain outstanding. It's unclear yet whether Teva will choose to settle the remaining suits, now that three verdicts are in.

- read the Bloomberg coverage