Merck makes $688m payout
pharmafile | February 18, 2013 | News story | Sales and Marketing | ENHANCE, Inegy, Merck, Vytorin, investors
Merck has paid out $688 million to end two class-action lawsuits which sprang up after the revelation of disappointing trial results five years ago.
The case predates the merger of Merck and Schering-Plough in 2009 and relates to the companies’ anti-cholesterol combination drug Vytorin (marketed as Inegy in Europe).
Results from the ENHANCE study, published in 2008, suggested Vytorin – which is Ezetrol (ezetimibe) plus Merck’s former blockbuster Zocor (simvastatin) – was no better than Zocor alone at reducing the build up of plaque in neck arteries.
The cases were brought by investors who bought securities issued by Merck and Schering-Plough between December 2006 and March 2008 and allege that the companies knew the trial had failed a year before data was announced.
They therefore claim they lost money when ENHANCE was made public.
Merck refutes this strongly, insisting both companies “acted responsibly in connection with the ENHANCE study”.
The company also makes it crystal clear that the payout does not represent any admission of liability or wrongdoing.
“This agreement avoids the uncertainties of a jury trial and will resolve all of the remaining litigation in connection with the ENHANCE study,” said Bruce N. Kuhlik, Merck executive vice president.
“We believe it is in the best interests of the company and its shareholders to put this matter behind us, and to continue our focus on scientific innovations that improve health worldwide,” he added.
The cases were taken out against the two companies and some current and former employees, including directors.
The manufacturer is paying $215 million to settle the legal action against Merck and $473 million to resolve the cases against Schering-Plough.
Merck insists the payout will have no impact on its results this year and has recorded a pre-tax and after-tax charge of $493 million in the fourth quarter of 2012.
The lawsuits are pending in the US District Court for the District of New Jersey and the agreement is subject to court approval.
Vytorin remains a big seller for Merck, bringing in $1.7 billion last year – although this was a fall of 7% on 2011’s sales.
It is indicated as adjunctive therapy to diet for the reduction of total cholesterol, LDL cholesterol, apolipoprotein B, triglycerides, and non–HDL cholesterol.
It also has a licence to increase HDL cholesterol in patients with primary (heterozygous familial and nonfamilial) hyperlipidemia or mixed hyperlipidemia when diet alone is not enough.
In the recent SHARP study, Vytorin lowered LDL cholesterol in patients with moderate to severe chronic kidney disease (CKD), and major vascular events were reduced in the treatment group compared to placebo.
Adam Hill
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