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Vioxx Maker Merck Sued by New York For Medicaid Fraud

Sep 19, 2007 | Parker Waichman LLP, LLP

Vioxx, a defective drug pulled off the market in 2004, is the target of yet another lawsuit.  Earlier this week, the state of New York joined with New York City in a Medicaid fraud lawsuit against Merck, the maker of Vioxx, in an effort to recoup the money state health programs spent on Vioxx prescriptions.

The Food & Drug Administration (FDA) ordered Vioxx off the market in 2004 after studies showed that people who took the drug had a higher risk for heart attack.   The recall came after an analysis of patients using Vioxx linked the defective drug to more than 27,000 heart attacks or sudden cardiac deaths in the U.S. from 1999 through 2003.  

In a statement released on Monday, New York State Attorney General Andrew Cuomo said that “Merck’s duplicitous and irresponsible conduct endangered New Yorkers and wasted our tax dollars.”  Between 1999 and 2004, New York State spent more than $100 million on Vioxx prescriptions through Medicaid and the Elderly Insurance Coverage program.   Most of the Vioxx prescriptions would never have been written had Merck been forthcoming about the drug’s potential risks, the statement said.  

This is the first time the state of New York and New York City have joined together in a Medicaid fraud lawsuit.   The complaint was filed under a new state false claims law that allows for triple damages and civil penalties.   The statement said that New York City had paid a “substantial share” of the costs for people on Medicaid.   “This is another step in the city’s continuing litigation effort to recoup the millions of dollars in overcharges by pharmaceutical companies to Medicaid Program for prescription drugs,” said New York Mayor Michael Bloomberg in the same statement.

This lawsuit is only the latest filed by states seeking to be reimbursed for money spent on Vioxx and treating people injured by its side effects.  Alaska, Louisiana, Mississippi, Montana, Texas and Utah have filed similar actions.  The suits have involved both consumer and Medicaid fraud, and focus on pricing and safety.

For its part, Merck denies the allegations, and says that it acted responsibly.      The company issued a statement yesterday claiming that it had monitored Vioxx while on the market, appropriately labeled it and voluntarily removed it when problems became evident. Merck said that it would continue to “vigorously defend” Medicaid fraud lawsuits.

Merck is facing 27,000 suits over Vioxx.  Earlier this summer, a New Jersey judge upheld a $13.5 million verdict against Merck, won by a couple who sued over injuries the man sustained after he took Vioxx.


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