Merck agrees to pay $4.85 billion in Vioxx settlement

With the settlement, it appears Merck will escape the worst-case scenario for the company and its investors: a payout approaching the $21 billion in costs drug maker Wyeth has amassed related to its diet drug recall.

"If Merck can put this to bed for anything close to ($4.85 billion), it will be a home run," said Samuel Davis, an attorney with Davis, Saperstein & Salomon in Teaneck, New Jersey who represents about 100 clients who took Vioxx.

Davis said he had not yet decided whether to recommend the settlement to them.

RIGHT TIME

Merck has won most of the Vioxx cases that have gone to trial and gained leverage in negotiating the settlement, which many have called favorable for the New Jersey-based drugmaker.

"We believe that this is the right agreement at the right time for Merck," Kenneth Frazier, Merck's president of Global Human Health and former general counsel, said in an interview.