Merck dodged a bullett. A big one. The courts ruled that plantiffs in suits against the company involving Vioxx cannot gain class action status. That means that each suit against the company over the possible side effects of the drug will have to proceed on its own. And, that makes each suit expensive for the plantiffs. Merck has plenty of money to spend on lawyers. A big advantage.
Merck is facing thousand of lawsuits over Vioxx, but, like the tobacco companies before it, Merck plans to fight these, and bleed it opponents for their legal costs. The company has won Vioxx suits in federal courts that it has lost.
Watch for Merck’s approach to be as successful as Altria’s was in tobacco liability suits. Merck now has the upper hand in the long battle in the couts, and that may scare off a lot of plantiffs.
Douglas A. McIntyre can be reached at firstname.lastname@example.org. He does not own securities in companines that he writes about.