Can the rights of individuals to make personal injury claims from pharmaceutical companies have adverse long-term consequences for society?
This is the question at the heart of this Policy Brief by Mary E Bartkus, who draws on her own experience of defending international claims amounting to billions of dollars, to argue that the cost of speculative claims can prevent the development of future life-saving medicines.
The policy brief examines the case of the pain reliever Vioxx® (rofecoxib), which was used by millions of patients worldwide before it was withdrawn from the market by Merck & Co., Inc. in ‘the interests of patients’ and ‘as the responsible course to take’, leading to more than 50,000 claims and class actions in the US and hundreds of jurisdictions across six continents.
Although Merck won most of the cases heard in the United States and prevailed in jurisdictions around the world, the company spent approximately $10 billion in withdrawing the medication and defending the litigation. Given that developing a new medication takes ten to fifteen years on average, and costs an average of $2.6 billion, the money that Merck & Co., Inc. spent to defend litigation could have funded the discovery and development of up to four or more new breakthrough life-saving and life-sustaining medications.
The Policy Brief questions the winners and losers in such a scenario, triggered when claimant lawyers capitalize on contingency fees, no cost-shifting, third party funding, relaxed standards of proof, and lay juries ill-equipped to decide complex scientific issues to fight such mass tort cases. The social cost is instructive as Europe considers a proposed Directive on collective actions that, even in its current form, would appear to permit diverse national class action regimes and procedures and invite forum shopping and costly litigation.