Immediately, Merck was hit with nearly 27,000 lawsuits. In November 2006, the company agreed to a $4.85 billion settlement. Merck now says that about 94% of the plaintiffs have chosen to participate in the settlement. I'm not sure the Garza family could have chosen to be part of the settlement or not (as the case was decided before the settlement was agreed), but if they family could, they might be sorry today they didn't do so.
A Texas appeals court overturned a multimillion-dollar verdict against Merck Wednesday. In April 2006, a jury awarded 71-year-old Leonel Garza's widow $32 million (which were later cut to about $7.75 million). The reason cited by the court was that Garza's family failed to provide evidence that Garza's long-standing heart disease could not have been the cause of his fatal heart attack in 2001.
While Merck's legal counsel likely had a hard time hiding his glee when he told journalists the "decision reaffirms that there is simply no reliable scientific evidence that Vioxx caused Mr. Garza's heart attack," many questions regarding Vioxx and Merck's own conduct in the matter remain. Only last month, The New York Times revealed that Merck wrote drug studies for doctors. To be fair, there seems to be an industry practice of ghostwriting medical research studies that are then published in academic journals under prestigious doctors' names.
So, with the Vioxx issue pretty much behind it and in the midst of some restructuring, is it worth while to take another look at Merck? Surely, its dividend yield is impressive at 3.89%, which could provide income and a defensive play in volatile markets, but don't forget the other recent setbacks Merck suffered including the unfavorable studies regarding its cholesterol pills, Zetia and Vytorin and the FDA's rejection of Cordaptive.
The stock is closer to a 52-week low and Merck almost seems due for some good news. But from its pipeline, no drugs are awaiting FDA approval and it's unclear when the current phase III drugs will reach that stage. And Merck needs a big seller, fast. In light of all that, I'm not that positive on the stock at this stage even if it finished the day up 1.68% on the Vioxx news.
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Reader Comments (Page 1 of 1)
5-14-2008 @ 6:02PM
Kenneth said...
I think that's kind of low. Insteading asking the victim for proof that there wasn't a prexisting condition, shouldn't we be asking Vioxx to prove that the drug is safe?
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5-14-2008 @ 6:44PM
ART said...
Good for Merck. While there may be some people who have legitimate problems from Vioxx, history shows that situations like this bring out all kinds of greedy people who are just trying to "use the perverted legal system". I suspect a significant number of those suing Merck smoked for 30 years, got drunk once a week, ate steak and french fries whenever they could, and sat in front of the TV set 4 hours a day. And then, they blamed Merck and Vioxx for their piss-poor lifestyle. Lawyers....give us and corporated Americ a a break!
5-14-2008 @ 10:06PM
pagebypage said...
This article is sick. Merck and the rest of the drug companies KNOW many of their drugs kill people and they simply don't care. They provide incentives for low-moral doctors to prescribe the things and our politicians support their dishonesty because many of them hold stock in the company and all they care about is making a little blood money. Only low lifes would invest in a company like that with no regard for how they achieve their profits. May God have mercy on your souls......
5-15-2008 @ 6:35PM
Nani said...
Does ANYONE read anymore ?? Good grief.....look at the warning that comes with your prescription!! Be honest with your Dr. about your past bad habits.....this is a fantastic drug & has helped many people....me included! Don't blame a great drug on your inability to read all the facts, discuss it with your Dr. and make an intelligent decision as to whether you are at risk. Many people have been deprived of a good medication because it was abused.