Avandia Plaintiffs to Receive Settlements from GlaxoSmithKline

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Published January 23, 2013 by techwire

Avandia Plaintiffs to Receive Settlements from GlaxoSmithKlineRESEARCH TRIANGLE PARK, N.C. —Thousands of people who sued GlaxoSmithKline could receive Avandia settlements worth as much as $57,000, based on an estimate from Bloomberg news.

The figure comes from details of an agreement among lawyers on how to settle the case.

Lawyers involved in lawsuits against GSK about the diabetes drug Avandia have resolved their differences over how $144 million in legal fees will be split, based on a court filing.

Bloomberg estimates the total settlement will be $2.3 billion with individuals receiving some $57,500 before legal fees.

The drug giant already has agreed to pay 38 states, including North Carolina, $90 million to settle cases in which it allegedly misrepresented the safety of Avandia. North Carolina’s share is some $3.1 million, according to state Attorney General Ray Cooper.

The settlement is one of several GSK has made in lawsuits brought against Avandia. The company has agreed to may more than $3 billion to resolve government probes of its marketing of Avandia and other medications, as well as patient lawsuits.

According to Bloomberg, eight lawyers on a court-appointed fee committee agreed to take a smaller portion of the fee fund after nine objectors challenged their payouts, a special master assigned to review the recommendations said in court papers made public Jan. 18 in federal court in Philadelphia.


The fee committee had asked for 71 percent of the fund set aside by U.S. District Judge Cynthia Rufe for the Avandia cases before her.

“Allocating a limited pot of common benefit fees among numerous counsel, all of whom are talented and capable attorneys and many of whom have made a significant contribution to the ultimate success of (a) case, is an unenviable task that is sure to lead to hurt feelings and bruised egos,” Bruce Merenstein, the special master, wrote in the filing. “Yet, all of the parties involved handled this difficult task with care and equanimity.”

The fee fund is 6.25 percent of the total settlement, according to court records.

That means the total accord may be worth $2.3 billion and the average payout for the 40,000 users of Avandia involved in the litigation would be about $57,500 – before legal fees. People familiar with the settlement who didn’t want to be named because the terms weren’t public have said the fee fund was 7 percent of the total, Bloomberg noted.

Glaxo said in 2010 it would stop promoting Avandia worldwide after regulators said marketing for the drug would be halted in Europe and sales would be limited in the U.S. because of studies linking the drug to increased risks of heart attacks. Sales fell 43 percent after those restrictions were imposed, Glaxo said.

The fee-advisory group, led by Philadelphia attorney Dianne Nast, agreed to a lower payout as part of the accord. Nast agreed to take $6.3 million, down from $6.7 million, according to court papers. Joseph Zonies, a Denver-based attorney who was slated to get the highest recommended fee, will see his firm’s payout reduced to $22.5 million from $24.4 million for 18,232 hours of work. Vance Andrus, another Denver-based lawyer, saw the biggest reduction, a cut of about $3 million that left him with a payout of $14.6 million, according to the filing.

Other lawyers in the group, including Thomas Cartmell, Bryan Aylstock, Stephen Corr, Paul Kiesel and Bill Robins III all agreed to reductions from about $700,000 to $1.3 million each, according to court papers.

Fifty-eight law firms are seeking payment from the fund for common benefit work. The proposed payout for 41 firms that did not object will remain unchanged, Merenstein said in the filing. The allocation is subject to final approval from Rufe.



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