Neither the Plaintiff or Defendant
leadership committees-nor the Court for that matter-has confirmed these
reports.
The
reports claim that the settlement will
resolve more than 7,500 lawsuits in federal and state courts against J&J. The
7,500 number is an estimate for how many filed lawsuits are for Plaintiffs who
have had a revision surgery. That number is important because as of right now,
it appears the settlement would only be for those Plaintiffs who have already
had a revision surgery, with an average payout of $300,000-$350,000. It is
rumored that the agreement does not bar Plaintiffs whose artificial hips fail
in the future from seeking compensation from J&J. Of course, there are many
different factors to this agreement including those Plaintiffs who cannot have
a revision surgery because of their current health conditions.
There is an open court
hearing next week in the MDL Court in Ohio, where many people think the
settlement will be announced.
The settlement will be the
second multibillion-dollar agreement this month for J&J, the world’s
largest seller of health-care products. The corporation agreed on November 4 to
pay $2.2 billion to resolve criminal and civil probes into the marketing of
Risperdal and other medicines. I will be posting a blog on that subject in the
next few days.
J&J has spent about $993
million on medical costs and informing patients and surgeons about the recall. J&J
set aside an undisclosed amount for litigation, which it increased before June
30. See my previous blog posts regarding that subject.
Details of the rumored are
sketchy, but it has been reported that 94 percent of eligible claimants must
sign up for the settlement or J&J can withdraw from the deal. This is often
times referred to as a Defendant’s ‘Opt-out clause’ and is very common in mass
tort global settlement agreements.
J&J recalled 93,000 ASR
hip implants worldwide in August 2010, saying 12 percent failed within five
years. About one-third of that number were sold in the United States. The
product went on the market in 2003.
J&J had touted the
metal-on-metal implants, first sold in the U.S. in 2005, as a new design that
would last 20 years and offer greater range of motion. DePuy officials have
long insisted that they acted appropriately in recalling the device when they
did. However, internal company documents disclosed during the discovery phase
of the ongoing litigation showed that DePuy officials were long aware that the
hip had a flawed design and was failing prematurely at a high rate. Those
documents revealed that internal DePuy projections estimated that it will fail
in 40 percent of patients in five years-a rate eight times higher than for many
other hip devices. Other documents showed that the head of DePuy’s orthopedic
unit, Andrew Ekdahl, oversaw the introduction of the hip and was warned by a
company consultant in 2008 that the implant appeared to have a design flaw.
As failures mounted, patients
complained in lawsuits that the metal-on-metal implant caused soft tissue
necrosis, pseudo tumors, metalossis, pain and follow-up surgeries known as revisions.
They claimed that debris from the chromium and cobalt device caused tissue
death and increased metal ions in the bloodstream.
Claims by unrevised
Plaintiffs may be handled in a second round of settlements.
The $4 billion settlement
will provide compensation to hip patients based on factors including age,
extent of injuries and whether they had one or more surgeries to replace
defective implants. Typically, a matrix-type grid is used to categorize
Plaintiffs based on these factors.
The accord also provides more
compensation to hip recipients who suffered “extreme injuries” from the
device’s failure, or endured long hospital stays after removal surgeries.
Also reported was that J&J
also has agreed to set aside funds to reimburse Medicare and other insurers for
claims paid on behalf of hip-implant patients, which could add hundreds of
millions of dollars to the value of the settlement.
Of course, any proposed
settlement would have to win Court approval.
DePuy continues to face
thousands of lawsuits involving another all-metal hip that it no longer sells
called the Pinnacle.
