Eli Lilly and Co. reached a final agreement to pay $700 million to settle most lawsuits claiming it failed to warn of health risks related to Zyprexa, its schizophrenia and bipolar disorder medication.
Lilly has paid $500 million into an escrow account and will pay an additional $200 million by Dec. 15, said Steve Weiss, a lawyer for the plaintiffs. The lawsuits claimed Zyprexa caused diabetes and other disorders and Lilly didn’t properly warn of the risks on its labels.
The terms of the agreement announced Tuesday are the same as those reached in June in a preliminary settlement between Indianapolis-based Lilly and attorneys representing about 70 percent of Zyprexa users who have filed product-defect claims, according to the company.
“This just finalizes the agreement,” said company spokeswoman Heather Lusk. “This will allow us to focus first and foremost on addressing unmet medical needs.”
The settlement is the ninth-largest by a single defendant in a U.S. civil lawsuit in 2005, according to data compiled by Bloomberg.
Lilly doesn’t admit any wrongdoing and will continue defending other Zyprexa product liability cases, the company said in a Securities and Exchange Commission filing. Zyprexa is the world’s largest-selling schizophrenia drug.
Under the agreement, $690 million will go to settle product defect claims filed by about 8,000 people and $10 million will cover administrative costs. The settlement is conditioned on receiving full releases from 7,193 claimants, Lilly said.