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State of Texas Sues Drug Firm Merck Over Vioxx

Posted on: Thursday, 30 June 2005, 21:00 CDT

AUSTIN -- Texas became the first state to sue pharmaceutical giant Merck & Co. to recoup money state Medicaid paid for the painkiller Vioxx before it was pulled from the market when potential hazards came to light.

The lawsuit filed Thursday by Attorney General Greg Abbott seeks $168 million, triple the $56 million that Texas' Medicaid program reimbursed pharmacies over five years. With other penalties, the lawsuit demands more than $250 million, Abbott said.

"The people of Texas have been cheated and defrauded by Merck," he said. "We are suing to get our money back."

An attorney for the $23 billion company, based in Whitehouse Station, N.J., said Merck acted responsibly and will "vigorously defend itself" against the lawsuit, filed in state district court in Travis County.

But Abbott contends that Merck misled doctors into thinking studies had found the arthritis drug Vioxx was safe, though the company allegedly knew it could increase the risk of heart problems. Merck stopped selling Vioxx in September.

"This is a prime example of a company's drive for profit steamrolling its duty to be safe," Abbott said. "Drug companies have an ethical, legal and professional responsibility to conduct meticulous clinical studies to ensure the safety and effectiveness of drugs for human consumption. Yet in this case, Merck took extreme measures to get this drug approved for widespread use, including to Medicaid patients, without the proper respect for good science and the concerns of peers."

The company spent millions of dollars marketing the drug to the medical community and directly to consumers.

The Texas Medicaid program reimbursed pharmacies $1.94 per 25-milligram pill. Over five years, Abbott said, the state paid for 700,000 Vioxx prescriptions totaling 29 million pills.

Ted Meyer, a lawyer representing Merck in the product liability litigation over Vioxx, said the company acted responsibly in its research on nearly 10,000 patients, in monitoring Vioxx while it was on the market and then in withdrawing the drug.

"Merck is confident in its research and in how Merck has communicated about Vioxx since its approval," Meyer said. He said the company also "promptly and extensively disclosed the data about Vioxx to the scientific and medical communities, and in the press.

"It is important to remember that the (U.S. Food and Drug Administration) approved the safety and efficacy of Vioxx after an extensive, rigorous scientific process in which the FDA weighed Vioxx's risks and benefits," Meyer said.

Abbott said his office has recouped about $100 million from companies the state has alleged defrauded the Medicaid program.

International drug firms Schering-Plough and Warrick Pharmaceuticals settled a Texas whistleblower lawsuit in May 2004 for $27 million. A similar wholesale pricing lawsuit against Dey Inc. was settled in June 2003 for $18.5 million.

The state also is pursuing millions of dollars from prescription benefits firm Caremark Inc. as part of a nationwide federal whistleblower lawsuit filed in San Antonio six years ago. That suit came to light last month when the Justice Department unsealed the records.

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