Merck & Co Inc., pharmaceutical giant who manufactured Fosamax, has agreed to pay $27.7 million to approximately 1,200 plaintiffs to resolve claims that their drug used to treat osteoporosis caused the bones in their jaws to deteriorate.
The proposal would settle 1,140 lawsuits of the 5,255 outstanding cases in which Merck is involved. What about the remaining 4,100 lawsuits?
Fosamax is a bisphosphonate prescription medication used to prevent or treat osteoporosis for women and men. Fosamax was approved by the FDA in 1995 and developed to treat post-menopausal osteoporosis and Paget’s disease of bone.
This drug has been under scrutiny by the U.S. Food and Drug Administration (FDA) for causing unusual femur fractures and severe musculoskeletal pain. Although it is meant to strengthen bones, it ironically causes more problems with bones.
The $27.7 million settlement will compensate victims who suffered a painful jaw-related condition known as osteonecrosis of the jaw (ONJ) or “jaw death,” reports Reuters. ONJ is a medical condition where the jawbone crumbles and dies. It may cause severe pain, loose teeth, exposed bone, loss of function and disfigurement.
Reuters reported that although the settlement would resolve a large portion of the 5,255 product liability lawsuits Merck faces over its Fosamax, it leaves about 4,100 cases unresolved.
According to Merck, this settlement agreement is contingent on a 100% participation rate, meaning that every one of the plaintiffs must accept the deal and its terms by January 13, as well as deliver releases for 100% of the plaintiffs by March 31. If there is one plaintiff who did not agree to these terms by the deadline, Merck has the authority to terminate the settlement outright.
Since Fosamax litigation began in 2005, Merck has lost verdicts of $285,000 and $8 million, but U.S. District Judge John Keenan lowered that amount to $1.5 million, mere “chump change” for a manufacturer as prosperous as Merck.
This group settlement offer in a mass tort litigation is known as a global resolution, and is different than a class action for a couple of reasons. The first difference is that when dealing with global resolution, every participant has an individual case, and accepts an individual settlement, whereas with a class action lawsuit, every participant accepts a same or similar amount of compensation.
In order to participate in this global resolution, there are certain requirements that must be met, and depending on the severity of those circumstances, it leads to different offers. This global resolution was solely for ONJ. Many of the victims involved in the outstanding cases were not part of the group settlement offer because they suffered injuries other than ONJ.
Some plaintiffs who suffered from ONJ may choose to opt out of the settlement to pursue their own lawsuits.
In most cases, the people who suffered lesser injuries and have a weaker claim prefer to be part of the global resolution because it increases their odds of obtaining some settlement or compensation. People that have stronger cases, due to more serious injuries, may wish to continue their own individual lawsuit in hopes of obtaining a larger award compared to the global resolution.
Before these Fosamax lawsuits, the sales of this drug brought in $3 billion at its peak in 2007. That was before Merck lost the patent protection in 2008.
What do you think about these Fosamax lawsuits? Do you think Merck should be allowed to opt-out if they don’t receive 100% participation in the arrangement?
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