Eli Lilly and Co. said late Thursday that it has entered into an agreement in principle to settle about 8,000, or 75%, of the claims against the company related to its schizophrenia medication, Zyprexa.
When finalized, the agreement will also result in the dismissal of claims against physicians and other health care professionals named as co-defendants in any cases covered by the settlement, the company said.
Most of the lawsuits claimed that before September of 2003, the information in the medication label, which listed the risk of hyperglycemia and diabetes as an infrequent adverse event since 1996, was not adequately displayed, according to the drug company.
Eli Lilly (LLY: news, chart, profile) will establish a $690 million fund for the settlement and will take a related, pre-tax charge of at least $700 million in the second quarter.
The agreement involves claimants who asserted they developed diabetes-related conditions from their use of Zyprexa. Claimants not covered by the final settlement are those represented by attorneys who are not participating in the agreement in principle.