GSK loses bid to keep experts out of upcoming Zantac trial

[March 25, 2023]  By Maggie Fick and Brendan Pierson

(Reuters) -A California judge on Thursday denied GSK Plc's bid to keep expert testimony linking its discontinued heartburn drug Zantac to cancer out of an upcoming trial, a setback for the British drugmaker facing lawsuits over the medicine in courts across the United States.

GSK shares were down 3.6% on Friday.

Analysts said that while Alameda County Superior Court Judge Evelio Grillo's ruling was not surprising, the litigation will likely weigh on the drugmaker's share price until the trial, scheduled to begin July 24.

The trial will be the first test of how Zantac cancer claims will fare before a jury. The plaintiff, California resident James Goetz, says he developed bladder cancer from taking the drug.

"Our client will now have his day in court, and we look forward to sharing the evidence with the jury that GSK has known for decades that Zantac contains staggering amounts of a proven carcinogen," Jennifer Moore, a lawyer for Goetz and others suing over Zantac, said in a statement.

GSK said in a statement it disagreed with the ruling and would defend the case at trial. The company has repeatedly denied that Zantac can cause cancer.

First approved in 1983, Zantac became the world's best selling medicine in 1988 and one of the first-ever drugs to top $1 billion in annual sales.

Originally marketed by a forerunner of GSK, it was later sold successively to Pfizer, Boehringer Ingelheim and finally Sanofi. Those companies also face lawsuits over the drug.

The companies scored a major victory in December, when a federal judge threw out all of the Zantac cases in U.S. federal court, some 50,000, after finding the opinions of the plaintiffs' expert witnesses linking the drug to cancer were not backed by sound science.

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

In 2019, some manufacturers and pharmacies halted Zantac sales over concerns that its active ingredient, ranitidine, degraded over time to form a chemical called NDMA. While NDMA is found in low levels in food and water, it is known to cause cancer in larger amounts.

The FDA in 2020 pulled all remaining brand name Zantac and generic versions off the market, triggering a wave of lawsuits.

Analysts said it was not surprising that Grillo ruled differently from the federal court because California's courts are known to be friendlier to plaintiffs.

"We've had some (investor) feedback who are disappointed here given that they were hoping a settlement would have been more likely," said Barclays analyst Emily Field. "This obviously removes the blue sky scenario of the case being totally thrown out, but really that wasn't people's expectation."

Citi analysts said the likely magnitude of any settlement for GSK is "likely very modest", at less than $5 billion, and noted that the statute of limitations will somewhat restrict a mushrooming of cases.

(Reporting by Maggie Fick in London, Aby Jose Koilparambil in Bengaluru and Brendan Pierson in New York; editing by Susan Fenton and Bill Berkrot)

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