Residents of the Miami Dade area might be aware of the string of lawsuits Pfizer Inc., the world's largest drugmaker, has dealt with over the last nine years. The business litigation concerns menopause and hormone replacement medication that is alleged to cause cancer in women and has brought in more than 10,000 lawsuits against the company.
When a company produces goods such as medications, personal injury lawsuits are a risk that must be dealt with. In the case of Pfizer, allegations are being made that the Wyeth and Pharmacia & Upjohn units of the company did not properly warn women of the potential effects of taking these medications. Whether this is definitively true or not, the company has already paid $896 million in settlements and set aside an additional $330 million to cover remaining lawsuits.
Throughout the litigation, the company has been able to lower the amounts of awards it pays in some cases, and has even succeeded in having some cases thrown out after trial. Still, lawsuits against the company have averaged an award of $150,000 per settlement. While this may mean a loss for the company, some believe that it will benefit the company to continue to resolve these cases -- even if more settlements must be funded -- and move on.
Companies in Miami Dade might not win every lawsuit put against them, but they are still entitled to a strong defense. Even when settlements must be paid, it is not the end. As for Pfizer, once the remaining business litigation is resolved the drugmaker will be able to put its investors at ease and begin to mend the company's reputation.
Source: Bloomberg Business Week, "Pfizer Paid $896 Million in Prempro Settlements," Jef Feeley, June 19, 2012