Did Merck settle too soon?

Yesterday, we reported that two appeals courts--in Texas and New Jersey--overturned multimillion-dollar verdicts against Merck in Vioxx cases. The Jersey court's reasoning: A state product liability law was pre-empted by federal law.

Wait a minute: Isn't pre-emption that big legal debate the Supreme Court intends to rule on later this year? The one that says FDA approval, being federal, should shield drugmakers from state liability? Yes and yes. If the Supremes decide pre-emption is the way to go, patients will find it difficult to sue drugmakers at all, and the companies will have a stronger position in settlement negotiations.

So, the Wall Street Journal Health Blog asks, did Merck jump the gun when it offered the big $4.85 billion settlement last year? At the time, it seemed like a good deal for the company. But in light of the overturned verdicts, and the possibililty of pre-emption, it seems Merck might have been able to get off even more lightly if it had waited a bit longer.

- read the post at the Health Blog

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