Merck wraps up Vioxx consumer action for up to $220M

Merck ($MRK) quietly settled a class-action suit over Vioxx last week, for up to $220 million. That's quite a lot of money, obviously, but given the nature of the case--it's a consumer class--and the settlement agreement, Merck's payout could be quite a bit less. Perhaps as little as $39 million, actually.

As the Philadelphia Inquirer reports, the U.S.-based drugmaker has been fighting the action in a Missouri court. Consumers had sued for fraud, saying they were cheated by Merck's sale of the now-withdrawn (not to say infamous) arthritis remedy. Unlike the Vioxx liability cases that Merck settled for billions, this case wasn't based on--and thus didn't have to prove--physical harm to the plaintiffs.

Under the proposed settlement, which has to be approved by Judge Marco Roldan, Merck would reimburse patients who used Vioxx, at a $90-per-month rate. Patients who can prove how many months they used the drug--which means they'd have paperwork dating back to at least 2004--would get full payment. Those who don't have their paperwork could get a one-time payment of $180.

Hence the wide range of potential payments from Merck; there's no way of knowing how many patients kept their receipts, or how many will actually file their claims.

The settlement wraps up another small chapter in Vioxx history. "This agreement is in the best interest of the company and its shareholders," Merck General Counsel Bruce N. Kuhlik said in a statement. "It reduces the uncertainty of litigation and ongoing defense costs, and helps us to remain focused on bringing forward innovative products and services for our customers."

- read the Merck release
- get more from the Inquirer