Pfizer Paid $896 Million in Prempro Settlements
Pfizer Inc. (PFE), the world’s largest drugmaker, said in a securities filing that it has paid $896 million to resolve about 60 percent of the cases alleging its menopause drugs caused cancer in women.
Pfizer has now settled about 6,000 lawsuits that claim Prempro and other hormone-replacement drugs caused breast cancer, and it has set aside an additional $330 million to resolve the remaining 4,000 suits, according to a filing with the U.S. Securities and Exchange Commission.
The reserve means New York-based Pfizer has committed more than $1.2 billion to resolving claims that its Wyeth and Pharmacia & Upjohn units failed to properly warn women about the menopause drugs’ health risk. Based on the May 10 filing, the company is paying an average of about $150,000 a case.
“It’s good for the company not to let this litigation linger,” Les Funtleyder, a New York-based fund manager at Miller Tabak & Co. in New York who holds Pfizer shares, said yesterday in a phone interview. “Resolving these cases gives investors one less thing to worry about.”
More than 6 million women took Prempro and related menopause drugs to treat symptoms including hot flashes and mood swings before a 2002 study highlighted their links to cancer. Wyeth’s sales of the medicines, which are still on the market, exceeded $2 billion before the release of the Women’s Health Initiative, a study sponsored by the National Institutes of Health.
Until 1995, many menopausal women combined Premarin, Wyeth’s estrogen-based drug, with progestin-laden Provera, made by Upjohn, to relieve their symptoms. Wyeth combined the two hormones in its Prempro pill. Pfizer completed its $68 billion purchase of Wyeth in 2009.
Pfizer and its units have lost 11 of 21 cases over the menopause drugs decided by juries since trials began in 2006, according to data compiled by Bloomberg.
The drugmaker got some of the verdicts against it thrown out after trial or had the awards reduced. It resolved some of the verdicts through settlements, while other decisions are on appeal.
“After nine years of litigation involving this medicine, we are confident in our medicine, our track record of success in court where we have won eight of the last 10 final verdicts at trial, and in our ability to resolve these cases on appropriate terms,” Chris Loder, a Pfizer spokesman, said in an e-mailed statement.
Pfizer officials said that the $330 million reserve was an estimate and they couldn’t be sure it would cover the remaining cases “given the uncertainties inherent in this product liability litigation,” according to the SEC filing.
At the height of the litigation, Pfizer faced more than 10,000 claims that its menopause drugs caused breast cancer, according to lawyers for former users. Those cases included more than 8,000 claims consolidated in federal court in Arkansas and other suits in state courts in Pennsylvania, Nevada and Minnesota.
A majority of those cases have been resolved, according to court and securities filings. A federal judge in Arkansas has sent other suits back to their home courts for trial. For example, two were returned to federal court in Connecticut to be considered by juries.
In April, a federal jury in New Haven, Connecticut, ordered Pfizer to pay at least $4 million in damages to a woman who developed breast cancer. The panel also ordered Pfizer to pay punitive damages over its handling of Prempro. A judge is still weighing how much, if any, to assess in punitives.
Lawyers for Margaret Fraser asked U.S. District Judge Janet Arterton in a May 29 court filing to award $8 million in punitive damages to “adequately punish Wyeth for its outrageous conduct” in connection with the drug. Wyeth is seeking a new trial in the case and disputes the plaintiff’s request for punishment damages, according to court filings.
Last month, a separate federal jury in Bridgeport, Connecticut, found Pfizer wasn’t liable for the breast-cancer death of a woman who died after taking the company’s menopause medicines. The panel in that case concluded that Wyeth officials properly warned Lynn Moss of the drug’s risks.
Zoe Littlepage, a Houston-based lawyer who represents women who haven’t settled their suits against Pfizer, said she’s preparing for another round of trials over the claims.
“The law firms that are left after these settlements are eager to see that every woman gets her day in court,” Littlepage said in an e-mailed statement. “We have worked long and hard to get these cases to trial.”
Esther Berezofsky, a New Jersey-based lawyer representing women suing over the menopause drugs, said her clients believe their claims are worth more than $150,000 average paid in other cases that settled.
“We’ll consider settling when the company decides to fairly compensate the women I represent for the horrendous injuries caused by these drugs,” Berezofsky said in a telephone interview.
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