The State of Alaska just resolved its claims against Eli Lilly & Company over Zyprexa.
I admit that I’m not really qualified to pass judgment on the State’s decision to settle. The only information I actually have about the case is from watching the TV news, unless you count eavesdropping on other non-involved lawyers at the next table while I was eating lunch at the Sandwich Deck.
I can understand the State’s discomfort about the case. The 8,000 pound elephant in the courtroom was the U.S. Supreme Court. The High and Mighty Court earlier this year ruled that defective product claims against medical device makers had to be given the big “No Way Jose!” under the Medical Device Amendment to the Food, Drug and Cosmetic Act. The creeping fear amongst the plaintiff-type lawyers is that the High and Mighties may well extend this same reasoning to another pending case that, like the Zyprexa lawsuit, involves drug labeling under the Act. (The High and Mighties should not be confused with the Tighty Whities, which can ride up, creating a whole different kind of “creeping fear.”)
Still, settling is never an easy thing to do when a lot is at stake, especially without a jury verdict. A favorable jury verdict — assuming the trial was headed that way — could have meant a bit more consideration in any final deal.
[FULL DISCLOSURE: I’m originally from Indianapolis (Lilly’s HQ) and I own a small position in Lilly. My equity interest is so small that the bump up in Lilly stock the settlement provided today was less than nominal.]