Merck & Co to pay $830 million to resolve Vioxx securities class action lawsuit

US pharma giant Merck & Co (NYSE: MRK) saw its shares dip 1.27% to $51.14 by close of trading on Friday, after it revealed it has reached an agreement with plaintiffs to resolvemulti-district class action lawsuit pending in New Jersey federal court.

The settlement class consists of persons who purchased Merck securities during the period from May 21, 1999, through October 29, 2004, inclusive, and who seek to recover damages under the federal securities laws for certain Merck statements regarding its arthritis painkiller Vioxx (rofecoxib). Shareholders claimed they paid inflated prices of the company’s shares, ahead of Merck’s withdrawal of the drug some 11 years ago due to safety concerns.

Under the agreement, Merck will pay $830 million to resolve the settlement class members’ claims, plus an additional amount for approved attorneys’ fees and expenses. After available funds under certain insurance policies, Merck’s cash payment for the settlement and fees will be approximately $680 million, for which the company will record a charge in the fourth quarter of 2015, which will be excluded from non-GAAP results. The agreement is subject to court approval. This latest settlement brings the total payments made by Merck to around $6 billion.