Eli Lilly has agreed to stump up $690 million dollars to settle a raft of lawsuits claiming that the company did not adequately warn patients taking its anti-psychotic drug Zyprexa (olanzapine) of a heightened risk of developing increased blood sugar levels and diabetes.
The firm says that it continues to believe that the claims are without merit, but has entered into the settlement “to reduce significant uncertainties involved in litigating such complex cases.”
Under the terms of the settlement, which are yet to be finalised, Lilly will place up to $690 million into a fund for plaintiffs who agree to settle their claims – expected to be around 75% of the total claims Lilly has identified. The company will take a pre-tax charge of at least $700 million in the second quarter to cover this settlement and other product liability claims.
Most of the lawsuits claimed that before September 2003, Lilly had not adequately displayed information on the Zyprexa label warning about the risk of developing hyperglycaemia and diabetes as an infrequent adverse event. Lilly maintains that the information has been on the label since 1996. In September 2003, the US Food and Drug Administration required label changes for all atypical antipsychotics, including Zyprexa, to warn against this risk [[18/09/03a]].