Vioxx Maker Found Liable

Vioxx trial, Plaintiff Carol Ernst, center, and her attorneys Randy Moore and Ben Morelli react to the jury's verdict in her favor in her case against Vioxx maker Merck Co. Friday, Aug. 19, 2005, in Angleton, Texas.
Merck & Co. suffered a serious blow Friday when it lost the first wrongful death lawsuit against it over its painkiller Vioxx, opening the floodgates for additional lawsuits and raising the risk that liability will climb higher than estimates that reach $18 billion.

Merck & Co.'s stock sank $1.16, or 4 percent, to $29.25 after the jury awarded $253.4 million in damages to a widow of a man who died in 2001 of heart arrhythmia, or irregular heart beat, after taking Vioxx for around eight months. The company plans to appeal.

Merck insisted no studies ever showed a link to irregular heart beat although CBS News Correspondent Cami McCormick reports from Angleton, Texas that it wasn't an issue in this case.

Merck yanked the popular pain reliever from the market last September after a study found it doubled patients' risks of heart attacks and strokes after 18 months.

The loss is especially damaging because Merck initially had been expected to win what was considered a weak case because no studies have linked Vioxx to arrhythmia. And the next two cases Merck faces appear somewhat stronger, according to experts.

"If they can't win the weak ones, what does that say about the strong ones?" asked Anthony Sebok, a professor at Brooklyn Law School.

CBS Legal Analyst Andrew Cohen says the verdict and the damages may prompt Merck to opt to settle with many of the pending plaintiffs before their cases go to trial.

Analyst Jason Napodano Zacks Investment Research said now anyone taking Vioxx with any type of a cardiovascular problem will feel emboldened to file a lawsuit. So far, more than 4,000 cases have been filed, some presumably stronger than the Angleton case. Merck has set aside $675 million to fight them.

"A Merck loss means that the number of cases against them increases tenfold," predicted Napodano.

If this verdict marks the beginning of a losing streak, Merck may back away from its pledge to try each case individually and not settle any, experts said. But they said a rash of verdicts would be necessary before the company changes its strategy.

"Merck says there will be no surrender. But you have to wonder if that will be true," said Sebok.