Yaz/Yasmin Lawsuit Payouts Continue to Rise
Bayer AG, the maker of Yasmin birth-control pills, said that settlements related to U.S. lawsuits over its product have increased to more than $402 million. Bayer said it has resolved almost 1,900 cases in which it has been claimed that Yasmin and Yaz contraceptives caused blood clots that can lead to heart attacks and strokes. The company said that the payments have broken down to an average of about $212,000 per case.
Bayer also announced that it had more than doubled its financial reserve for future payments related to Yaz cases, setting aside an additional $610 million this quarter alone. The $610 million is to pay the company’s costs beyond what insurance will cover for legal fees, including cases that haven’t been settled yet. Even this huge figure may not be enough as drug-industry analysts have said that Bayer may end up paying out over $2 billion to resolve all the cases related to the birth-control problems.
Lawyers suing the company have brought forward FDA reports of at least 50 deaths tied to the pills from 2004 to 2008. The lawyers have argued that Bayer marketed the contraceptives for unapproved uses and misled women about their risks.
The suits follow a decision in April of this year by the U.S. FDA to order Bayer along with other drug makers to include stronger blood-clot warnings on their contraceptive products. Pills like Yasmin, which contain a synthetic hormone known as drospirenone, will now come with warnings that say researchers have found the drugs can triple a woman’s risk of blood clots.
Given the number of women taking Yasmin, which was the fourth most prescribed
oral contraceptive in 2011, with 4.6% of the overall market, the suits
have affected potentially millions of women. Bayer faced more than 12,000
lawsuits over the Yasmin line of contraceptives, including claims that
they caused blood clots in some women and damaged gallbladders in others.
Thus far, Bayer has agreed to settle 1,877 cases.
The case is very important to the company’s bottom line as Bayer’s contraceptive drugs generated a whopping $1.1 billion in sales in 2011, making them the company’s third biggest source of revenue.
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Source: “Bayer’s Yasmin Lawsuit Settlements Rise to $402.6 Million,” by Jef Feeley, published at Businessweek.com.