Lawyers prepare for Vioxx litigation

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PHILADELPHIA (AP) -- Most of the 250 lawyers assembled in the Wyndham Philadelphia hotel ballroom listened intently yesterday as fellow attorney Barry Hill showed off an extensive collection of trinkets and product samples emblazoned with the logo of the now-withdrawn drug Vioxx.

"Maybe you can use them [the samples] as evidence," joked Mr. Hill, a Wheeling, W.Va., trial lawyer who bears a resemblance to actor William Holden.

The remark elicited chuckles from an audience that has to be one of Vioxx manufacturer Merck & Co.'s worst nightmares: a roomful of litigators who are suing or plan to sue the drug maker that pulled the arthritis drug off the market last year after it was found to double patients' risks of heart attack and strokes.

Merck officials insist the company acted responsibly at all times and is well prepared for the litigation onslaught. "We have a good story to tell," said Ted Mayer, a partner at Hughes, Hubbard & Reed in New York who is representing Merck. "We are in this for the long haul."

With estimates of Merck's potential legal liability ranging from $4 billion to $30 billion, the strategies, decisions and deals devised at meetings like this one will play a significant role in shaping Merck's future.

Such conferences have become an almost ritualized part of the product liability litigation industry. Discussion topics for the two-day meeting sponsored by Mealey Publications & Conferences Group include how to prepare witnesses, a review of the most relevant information found in clinical studies, and what role the Food and Drug Administration may play in the lawsuits.

The $895 registration fee paid by most attendees covers some meals, a conference handbook on a compact disc, and what Mealey describes as a "networking reception."

About 20 million people took Vioxx since it was introduced in 1999, and Merck said it had been sued in at least 475 Vioxx-related cases through Nov. 30. The total has since increased to at least 700, according to federal and state court filing reviewed by the Associated Press, and it is likely to grow higher.

The potential fallout from the lawsuits caused rating agencies to downgrade Merck's debt, and Merck shares now trade below $31, down from about $45 a share before Vioxx was withdrawn on Sept. 30. That has wiped out more than $30 billion of the company's stock market capitalization.

Merck would not comment on whether it sent a lawyer to the conference. But veterans of such gatherings say it's likely a lawyer for the company will attend -- typically a young attorney that no one will recognize -- and take copious notes.

With $14.2 billion in cash and investments and a steady revenue stream, Merck can withstand significant payouts, especially since any settlements would likely be made over time, analysts have said. Whatever the total, that could mean less money for research and development at a time when Merck's biggest moneymakers are close to losing their patent protection.