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Merck's Strategy for Dealing with Vioxx: Why the Old Recipes for Success Won't Succeed
It seems that the same question is asked every time two pharmaceutical plaintiffs' lawyers get together these days: “Don't you think Merck can just pull a Baycol?” Referring to Bayer's strategy for resolving the recent litigation over Bayer's dangerous ' and withdrawn ' statin drug, these lawyers are concerned that Merck, like Bayer, can somehow escape compensating thousands of victims. No doubt due to the widely read article in The Wall Street Journal (May 3, 2004) that essentially gave Bayer an “academy award” for its handling of Baycol, reporters across the country, trying to analyze the emerging Merck debacle last fall, were asking the same question of their trial lawyer interviewees. What these inquiring minds are inquiring about is whether Merck, clearly faced with thousands of actions, can “lump and split” them. On the one side, Merck would place a very large pile of cases it deems non-compensable, and on the other, a much smaller pile comprised of those cases that Merck will agree to discuss and value. The answer to this question seems to be, at this relatively early date, that even if Merck wishes it could approach the problem this way, it cannot. Moreover, it cannot use the strategy it used in the phenylpropanolamine (“PPA”), Propulsid, or Rezulin litigation, either. In fact, any attempt to apply the strategies employed in those litigations may end in sheer disaster.
The reason that Merck cannot slice and dice its massive liability in the Vioxx case is very clear. Each of these prior litigations has ingredients for defendants' success that Vioxx does not have. Baycol, the most highly recognized successful litigation approach, deserves first examination. Engineered most probably by Gary McConnell, assistant general counsel for Bayer, and implemented rather flawlessly by him, Brad Honnold and John Jackson (Shook Hardy and Bacon), Bayer's strategy was to draw an early and deep line in the sand and not cross it. Their determination not to budge, however, was not the main reason for the success. The success had more to do with the sand into which the line was drawn than the stubbornness not to move. That sand ' ie, the provable damages ' does not exist in Vioxx.
Baycol was a cholesterol-lowering drug that clearly and unequivocally caused a muscle deterioration condition known as rhabdomyolysis. This condition onset rapidly and was excruciatingly painful and debilitating to suffer through. The condition, if severe enough, can and did cause permanent injury and death. However, the rhabdomyolysis cases were only a portion of the cases that were brought against Bayer and the remaining 15,000 or so cases did not have this “signature,” significant injury. This lack of significant demonstrable injury is the main ingredient that makes all the difference in the world between these two litigations. In Baycol, at least 90% of the cases filed or threatened were non-rhabdomyolosis cases, referred to by the plaintiffs as the “non rhabdo” cases and referred to by Bayer as the “aches and pain” cases. These were the cases that Bayer split off, denoted as “not legally viable,” and on which Bayer did not pay a cent.
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