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Coloplast Said to Pay $16 Million to Settle Mesh Lawsuits

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March 4 (Bloomberg) -- Coloplast A/S, the Danish maker of medical products, agreed to pay about $16 million to settle lawsuits over claims it injured women with its vaginal-mesh inserts, three people familiar with the accord said.

Officials of Humlebaek, Denmark-based Coloplast agreed in January to resolve about 400 suits over the inserts, which are designed to support internal organs, said the people, who asked not to be identified because they weren’t authorized to speak publicly about the settlement. The accord will provide an average payment of about $40,000 for each claimant, they said.

Settlement talks are continuing with other manufacturers facing thousands of suits over their vaginal-mesh inserts, including C.R. Bard Inc and a unit of Endo Health Solutions Inc., the people said. Some implant makers, such as Johnson & Johnson, the world’s biggest maker of health-care products, have declined to discuss out-of-court settlements, the people said.

“It appears that momentum is building for some type of global resolution as more of these vaginal-mesh cases settle,” Carl Tobias, who teaches product-liability law at the University of Richmond in Virginia, said in an e-mail.

Company officials confirmed in a statement to the Copenhagen Stock Market today that they reached a settlement “with a group of lawyers on a number claims against the company” over its vaginal-mesh implants.

Unspecified Number

Coloplast executives didn’t specify the number of cases settled or the amount. Ulla Lundhus, a spokeswoman for Coloplast, declined yesterday in an e-mailed statement to comment on the report of a settlement.

Coloplast rose 2.4 percent to 455.40 kroner at 1:57 p.m. in Copenhagen trading after earlier gaining as much as 2.8 percent. The shares have risen more than 64 percent so far this year.

Coloplast is best known as a maker of ostomy and urine bags for post-surgical use. In January, the company raised its sales forecast after reporting double-digit growth in all business units during its first quarter.

Even after the January settlement, the company still faces more than 1,500 suits over alleged harm to women caused by its vaginal-mesh inserts, the people said.

Many of the cases against implant makers in U.S. federal courts have been consolidated before U.S. District Judge Joseph Goodwin in Charleston, West Virginia, for information exchanges and bellwether trials.

Study Ordered

The U.S. Food and Drug Administration ordered Coloplast, Johnson & Johnson, Bard and more than 30 other vaginal-implant makers in 2012 to study rates of organ damage and complications linked to the implants.

J&J officials have said in court filings that more than 1 million women have received the inserts during the past 15 years to help hold up internal organs or treat incontinence.

Women contend they have suffered organ damage and pain after the implants eroded and have sued New Brunswick, New Jersey-based J&J; Natick, Massachusetts-based Boston Scientific Corp.; Malvern, Pennsylvania-based Endo; and Bard, which is based in Murray Hill, New Jersey.

More than 30,000 federal suits against insert makers have been consolidated before Goodwin. The total number of suits could swell to more than 50,000 if companies can reach a global settlement of claims, the people said.

Officials of Bard, Endo and Boston Scientific are continuing discussions about resolving vaginal-mesh lawsuits as part of a global settlement of cases, the people said.

Company Spokesmen

Scott Lowry, a Bard spokesman; Endo spokesman Blaine Davis; and Denise Kaigler, a Boston Scientific spokeswoman, didn’t return calls seeking comment on whether they are continuing settlement discussions.

Matthew Johnson, a spokesman for J&J’s Ethicon unit, said the company doesn’t comment on legal strategy. Ethicon makes J&J’s lines of vaginal-mesh inserts.

Coloplast executives have declined to seek a blanket settlement of cases over the company’s implants and instead are settling inventories of cases collected by individual plaintiffs’ lawyers, according to the people.

Coloplast has been sued over implants including the Novasilk-Synthetic Flat Mesh System and the Aris-Transobturator lines, according to court filings.

Lana Varney, one of Coloplast’s lawyers, told Goodwin earlier this year that the medical-device maker had “reached a resolution with one major inventory of cases,” according to a transcript of a Jan. 9 hearing in West Virginia. She didn’t specify how many cases were being settled or for what amounts.

Many Cases

The judge said the plaintiffs’ lawyers’ inventory of cases that settled “was fairly large, though, several hundred cases, wasn’t it?” according to the transcript.

“Yes, your honor, a significant size,” Varney replied.

The settlement came after lawyers for Coloplast and the plaintiffs group sat down in December with Ken Tekell, a Houston-based lawyer who served as a mediator, Varney said.

Coloplast’s lawyer also told the judge the company had made “offers to five other groups and we are optimistic we will be able to reach agreement on resolution” of some of the lawyers’ inventories, according to the transcript.

Varney also said Coloplast’s goal was to work out comprehensive settlements with individual lawyers that resolve all vaginal-mesh cases over the company’s products.

“We’d like to address the entire inventory so that we can buy our peace and move on down the road,” she said, according to the transcript.

The consolidated cases are In Re: Coloplast Corp Pelvic Support System Products Liability Litigation, 12-md-2387, U.S. District Court, Southern District of West Virginia (Charleston).

To contact the reporter on this story: Jef Feeley in Wilmington, Delaware, at jfeeley@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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