What’s the best advice for companies facing legal action? Admit nothing and deny everything, apparently. Endo International Plc. has certainly taken that to heart – and yesterday’s news that the company has reached an $830 million settlement to resolve “a substantial majority” of lawsuits over its AMS transvaginal mesh product hasn’t changed much. In a carefully worded news release, Endo was keen to point out that just because they’re settling thousands of cases, that’s no indication they did anything wrong:
“The agreements, which are subject to final documentation, were entered into solely by way of compromise and settlement and are not in any way an admission of liability or fault. The settlements, once final, will resolve a substantial majority of the AMS vaginal mesh-related claims.”
The same release also includes a reiteration of Endo’s stance that their mesh products are, all in all, still pretty effective:
“The Company continues to support the FDA's recommendations that physicians be well trained and patients fully understand the risks associated with the use of mesh products. Endo and AMS remain committed to the safety and efficacy of AMS's transvaginal mesh products and will continue developing AMS' Women's Health business and devices product suite so that women have appropriate access to innovative, safe and effective therapies.”
That’s 16,707 women who allege the company’s mesh devices caused them harm, with some claiming that the mesh resulted in pain, incontinence, scarring, perforation, and other side effects.
Reading between the lines, it’s easy to think that Endo and its subsidiary, American Medical Systems (AMS), are more interested in making these suits go away than in ensuring their vaginal mesh devices are safe to use. As of April 15, 2014, 16,707 cases involving AMS’ mesh devices have been consolidated to a single court in West Virginia as part of a legal proceeding known as multidistrict litigation. That’s 16,707 women who allege the company’s mesh devices caused them harm, with some claiming that the mesh resulted in pain, incontinence, scarring, perforation, and other side effects. Six other mesh manufacturers continue to face their own MDLs, but none have quite as many lawsuits filed against them as AMS. The second largest MDL, against J&J’s Ethicon unit, currently has 15,050 cases. The smallest, alleging that Neomedic Pelvic Repair System causes injuries, lists just 25.
This week’s settlement exceeds Endo’s previous estimation that $520 million would be needed to cover known, pending and future claims.
There are several requirements tied to the settlement, which was agreed upon by both Endo and several plaintiffs’ law firms. Plaintiffs will need to show evidence that they received the AMS vaginal mesh implant, as well as provide medical records to claim their settlement money. According to the company:
“Based on the settlement agreements […], the Company will incur an incremental pre-tax, non-cash charge of approximately $625 million in the first quarter of 2014, increasing the product liability accrual to approximately $1.1 billion in total. Of this $1.1 billion, approximately $830 million is related to the resolution of the approximately 20,000 cases as noted above.”
The “20,000” figure is a reference to the number of cases filed in West Virginia, as well as lawsuits pending outside of the MDL.
Good news, then, for women who are seeking compensation for injuries allegedly caused by AMS’ mesh device. Could this have an impact on the six other MDLs? Hopefully – despite some individual setbacks, the general impetus of these cases has been with plaintiffs, with more settlements expected to be announced throughout the year. The FDA has also weighed in on the sale of mesh implants, announcing just this week that it wants to reclassify the products as high-risk devices requiring pre-market approval before being sold. These things are never simple, though, and you can expect that mesh will continue to be used to treat pelvic organ prolapse, and other disorders, for the foreseeable future.