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Original Source: FD (FAIR DISCLOSURE) WIRE
OPERATOR: ... For today. [OPERATOR INSTRUCTIONS.]
As a reminder, today's conference is being recorded for replay purposes and, before we start our conference today, the company has asked me to read the following forward-looking statement. Please be advised that, since Merck is involved in ongoing litigation, there may be certain issues that cannot be addressed on this teleconference. Please be advised that this teleconference contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve risks and uncertainties, which may cause results to differ materially from those set forth in the statements.
The forward-looking statements may include statements regarding product development, product potential, or financial performance. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. Merck undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements made on this teleconference should be evaluated together with the many uncertainties that affect Merck's business, particularly those mentioned in the cautionary statements in item one of Merck's form 10-K for the year ended December 31st, 2005, and in its periodic reports on form 10-Q and form 8-K, which the company incorporates by reference.
I would now like to turn the conference over to your host for today's presentation, Mr. Michael Heinley, Senior Director for Merck Public Affairs. Please proceed, sir.
MICHAEL HEINLEY, SENIOR DIRECTOR FOR PUBLIC AFFAIRS, MERCK PHARMACEUTICALS: Thank you, and thank you for joining us, everyone. The purpose of this call is to discuss the outcome of the Vioxx product liability trial in Texas. Joining us today for the call is Ken Frazier, Merck's Senior Vice President and General Counsel, and also joining us is Richard Josephson of Baker Botts, a member of Merck's defense team. After some brief opening statements, we'll then open the call up for questions.
So now, let me turn it over to Ken Frazier.
KEN FRAZIER, SVP AND GENERAL COUNSEL, MERCK PHARMACEUTICALS: Thank you, Michael, and thank you all on the phone for joining us this afternoon.
I'd like to start with a few words about the trial that concluded earlier today, and then, as Michael just said, we can get some questions after Richard Josephson speaks.
Let me start by saying that we are both disappointed and that we respectfully disagree with the outcome of today's trial in Texas. While we disagree and we actually are disappointed with the jury's findings, it is also important to note that we have very strong points to raise on appeal, and that we are hopeful that the appeals process will correct this verdict.
This was a case that alleged short-term use, very short-term use and, as we stated in our closing arguments, Mr. Garza did not take Vioxx in the weeks leading up to his death. Furthermore, no single study shows short-term use of Vioxx at the length that he took as leading to a greater incidence of heart attacks. The medical records in this case indicated that Mr. Garza visited his doctor on March 27th, 2001 complaining of arm pain, and was given a one-week supply of Vioxx in 25-milligram samples. There was no documentary evidence that Mr. Garza received any Vioxx pill after that seven-day supply. He died of a heart attack more than three weeks later on April 21st, 2001.
As you probably know, this case was tried in the Rio Grande Valley, and that area has been described as a plaintiff's paradise by the Associated Press, and has been cited as the nation's most difficult jurisdiction for defendants by the American Tort Reform Association. Merck intends to appeal both the compensatory and punitive damage awards in this case. As you know, Texas law limits punitive awards to twice economic damages plus 750,000 and, in this case, since the plaintiff did not prove any economic damages, it is a limit of 750,000.
More importantly, we continue to push these cases because we know that Merck acted responsibly in studying Vioxx and properly disclosing data. The company carefully studied Vioxx before and after approval by the FDA and consistently made the results available to FDA and the wider medical community. Indeed, Merck acted responsibly every step of the way, from researching Vioxx prior to approval in clinical trials to monitoring the medicine while it was on the market to voluntarily withdrawing the medicine when it did. But, at the end of the day, the simple fact remains that, unfortunately, heart attacks are a major health problem …