Merck to pay $950M in Vioxx case

Merck & Co., the second-largest U.S. drugmaker, will pay $950 million and a unit of the company will plead guilty to a criminal misdemeanor charge to resolve a U.S. probe of its illegal marketing of the painkiller Vioxx.

Merck Sharp & Dohme will plead guilty to one count of misbranding Vioxx, the company and U.S. prosecutors said yesterday. The company will pay a $321.6-million criminal fine and $628.3 million to resolve civil claims that it sold Vioxx for unapproved uses and made false statements about its cardiovascular safety.

"Today's resolution appropriately reflects the severity of Merck's conduct and is yet another reminder that the government will not tolerate misconduct by drug companies that bend the rules and put patient safety at risk," Carmen Ortiz, the U.S. attorney in Boston, said in a statement. Prosecutors in her office led the seven-year investigation into the company's Vioxx marketing tactics.

Approved by the Food and Drug Administration in 1999, Vioxx became Merck's third largest-selling drug by 2003, generating $2.5 billion in annual sales. The company pulled Vioxx off the market in 2004 after a study found it posed an increased risk of heart attacks and strokes.

The company, based in Whitehouse Station, N.J., already paid $4.85 billion to settle thousands of patient lawsuits claiming injuries, and another $1.9 billion for legal costs. It set aside $950 million in October 2010 for the criminal settlement announced Tuesday.

"We believe that Merck acted responsibly and in good faith in connection with the conduct at issue in these civil settlement agreements, including activities concerning the safety profile of Vioxx," Bruce N. Kuhlik, the company's general counsel, said in a statement.

The shares fell 33 cents, or .97 percent, to $33.81 in New York Stock Exchange composite trading.

Merck Sharp & Dohme will plead guilty to violating the Food, Drug and Cosmetic Act by distributing a misbranded drug, the Justice Department said. The company will admit that between May 1999 and April 2002 it sold Vioxx for rheumatoid arthritis when it was not approved by the FDA for that use. Merck got such an approval in April 2002.