A jury today awarded $9 million in punitive damages to a New Jersey man who blamed Merck's Vioxx for his heart attack, but the company vowed to continue fighting cases involving its withdrawn pain medicine.
That comes on top of last week's award of $4.5 million in compensatory damages to 77-year-old John McDarby by the jury that found Vioxx was a significant contributing factor to his heart attack and that Merck failed to adequately warn of the drug's risks.
In order to award punitive damages, the jury of six women and two men in New Jersey Superior Court needed to find that Merck withheld material information on Vioxx from the US Food and Drug Administration, and that the company's actions were deliberately meant to harm.
"This is the first punitive damage verdict in New Jersey since the punitive law was changed 11 years ago. That's phenomenal," said McDarby's attorney Rob Gordon.
Under state law, punitive damages - awarded as punishment to rectify a wrong committed by a defendant - were capped at $22.5 million, or five times compensatory damages.
Shares of Merck, which said it would appeal the verdicts, were down 19 cents to $34.23 on the New York Stock Exchange.
"I'm surprised investors are not greeting this with more pessimism," said Scott Henry, an analyst for Oppenheimer & Co.
"It is only one data point among many, but in no way is this a positive development. These awards will re-motivate the plaintiffs' lawyers," added Henry.
Prudential Financial analyst Timothy Anderson said Merck could now be looking at legal costs comparable to what Wyeth has faced with its withdrawn "fen-phen" diet drugs. Wyeth has already taken some $21 billion in charges.
"Seeing as there are 10,000 Vioxx cases already filed, with more likely on the way, Merck's Vioxx liability could end up being larger than we have previously anticipated if more verdicts are handed down similar" to this one," Anderson said.