The Recall of Vioxx

Merck offered Vioxx to hospitals and doctors at discounted rates. According to William Larkin, senior vice president of pharmacy at GNYHA (Greater New York Hospital Association), "Such nominal pricing policies are employed by many drug companies as a way to get physicians in the habit of prescribing drugs." Termed as 'super aspirin,' Vioxx was promoted as a cure for everything from arthritis pain to menstrual cramps. It was projected as a painkiller, which was a boon for patients suffering from arthritis and that overcame gastrointestinal problems caused by the older generation of painkillers. Merck spent $160.8 mn in promoting Vioxx in 1999. It soon emerged as one of the fastest-selling drugs in the world...

Merck also revealed that the way it handled the Vioxx issue was being investigated by the US Justice Department, the Securities Exchange Commission and the US Congress. A class action lawsuit was filed on October 01, 2004 against Merck on behalf of its shareholders who purchased Merck securities, including common stock, between October 30, 2003 and September 29, 2004 alleging that Merck failed to disclose material information during the Class Period concerning the safety profile of Vioxx. The lawsuit, filed in the District Court of New Jersey seeked to recover damages on behalf of all class members who purchased Merck stock during the class period. By October 31, 2004, the withdrawal of Vioxx had attracted 375 lawsuits against Merck...