Merck has agreed to pay $688 million to settle lawsuits claiming it harmed investors by delaying the release of unfavorable studies of the cholesterol drug Vytorin.
The lawsuits against Merck and Schering-Plough, who both sold the drug, claim that the companies had known for about two years that a clinical trial of the drug revealed that it was not better than a statin drug at limiting the buildup of plaque in the arteries. Those results were not released until 2008, which led to the companies' stock dropping significantly.
Vytorin combines the statin drug Zocor, with the anti-cholesterol drug Zetia. Studies, including the one in the lawsuit, have failed to show that Vytorin or Zetia is more effective than statins, most of which are available as low-cost generics.
Merck did not admit any wrongdoing and said both companies had acted responsibly in connection with the clinical trial.
Despite skepticism by cardiologists, Vytorin was heavily promoted by Merck and Schering, and was approved by the Food and Drug Administration in 2004. Sales of Vytorin have fallen since 2007, but Vytorin is still among Merck's top-selling drugs. In 2012, Vytorin brought in $1.8 billion, according to company filings.
Merck earned $6.66 billion in net income last year on revenue of about $47 billion.
Last year, Merck had another setback involving Zetia when the F.D.A. rejected its application for a drug that would combine Zetia with the active ingredient in Lipitor, a statin made by Pfizer that is now available as a generic. In January, Merck said it was resubmitting its application after providing new information to the FDA.
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Source: The New York Times, "Merck Settles Investors Suits Over Cholesterol Drug," Feb. 14, 2013.