Plaintiff in first Zantac lawsuit set for trial drops case

[August 17, 2022]  By Brendan Pierson and Natalie Grover

(Reuters) -The plaintiff in the first lawsuit over the heartburn drug Zantac scheduled to go to trial has agreed to drop his case, according to his attorney and drugmakers named as defendants.

Tuesday's news came days after shares of GlaxoSmithKline Plc, Sanofi SA, Pfizer Inc and Haleon Plc were hit by mounting investor concern about thousands of lawsuits claiming the drug, which U.S. regulators pulled from the market in 2020, causes cancer.

The first trial in one of those lawsuits had been scheduled to begin on Monday in Illinois state court. The plaintiff, Joseph Bayer, alleged that he developed esophageal cancer from taking over-the-counter Zantac.

Alexandra Walsh, an attorney for Bayer, said her client could not proceed for "personal health reasons" but had the right to refile his case within a year.

Zantac, originally marketed by a forerunner of GSK, has been sold by several companies at different times, including Pfizer, Boehringer Ingelheim and Sanofi as well as a plethora of generic drugmakers.

Haleon, spun out as an independent company last month, comprises consumer health assets once owned by GSK and Pfizer.

In a statement on Tuesday, GSK said it had not paid anything in exchange for the voluntary dismissal of the Bayer case.

Seperately on Tuesday, Bloomberg reported that a handful of generic companies including Teva, Perrigo, Sun Pharmaceutical Industries and Dr. Reddy’s Laboratories agreed to settle with Bayer for a total of more than $500,000 before the case was set to go to trial, citing people familiar with the deal.

The companies did not immediately respond to requests for comment.

Concerns around Zantac - known chemically as ranitidine - containing potential cancer-causing impurities started to emerge in 2018, well after generic versions of the medicine had been launched.

 GSK (GlaxoSmithKline) logo is seen in this illustration, August 10, 2022. REUTERS/Dado Ruvic/Illustration

FINANCIAL IMPACT

More than 2,000 lawsuits are consolidated in federal court in West Palm Beach, Florida, where a hearing on what expert evidence will be allowed in future trials is scheduled for Sept. 20.

The first federal court trials are expected some time next year, though a highly favorable ruling for the companies on evidence could effectively end the litigation before then.

There is considerable uncertainty surrounding the potential total financial impact of the Zantac litigation, Morgan Stanley analysts wrote in a note on Monday.

"There is also a scenario of zero liability if the defendants win the early cases," they wrote.

At the heart of the claims is an impurity, called N-nitrosodimethylamine (NDMA), which is considered a probable carcinogen.

U.S. regulators in 2020 determined that the presence of the impurity in some ranitidine products increases over time and when stored at higher than room temperatures - and could therefore result in exposure to unacceptable levels of NDMA.

Meanwhile, Zantac makers strongly contest the once widely used drug's causal link to cancer, suggesting that NDMA levels in the medicine are close to what was found in common foods like grilled and smoked meats.

(Reporting by Leroy Leo in Bengaluru, Brendan Pierson in New York and Natalie Grover in London; Editing by Marguerita Choy and Edmund Blair)

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