By David Voreacos – Aug 10, 2011 1:54 PM MT
Merck & Co. must defend a lawsuit claiming it violated securities laws by downplaying the cardiovascular risks of its Vioxx painkiller before the company pulled the drug from the market in 2004, a judge ruled.
Merck, the second-biggest U.S. drugmaker, withdrew Vioxx after a study showed it doubled the risk of heart attacks and strokes. Investors adequately stated a case that Merck misrepresented the drug’s safety profile, said U.S. District Judge Stanley Chesler in Newark, New Jersey.
Investors also can pursue claims that Merck misled them about a 2000 study, known as Vigor, which reported that the medicine caused five times more heart attacks than another painkiller, naproxen, Chesler ruled. Merck said one explanation was that naproxen protected the heart.
The judge ruled that investors “plausibly suggest that Merck had no reasonable basis for its public characterization of the Vigor results as ‘likely’ due to naproxen’s cardioprotective quality,” according to Chesler’s Aug. 8 decision.
Merck, based in Whitehouse Station, New Jersey, faces potential legal costs of at least $7.7 billion related to Vioxx, including $4.85 billion to settle thousands of lawsuits claiming injuries. It also set aside $1.9 billion for legal costs. Last October, Merck said it set aside $950 million to resolve a criminal probe.
“Merck continues to believe that this lawsuit is without merit, and will continue to defend itself vigorously against these claims,” Ronald Rogers, a spokesman for the company, said today in a phone interview.
The case is Merck & Co., Inc., Securities, Derivative & ‘ERISA’ Litigation, MDL-1658, U.S. District Court, District of New Jersey (Newark).
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