Tuesday, December 4, 2007
Jennifer Wolsing, an associate at Blackwell Sanders in St. Louis, has posted a working paper to SSRN -- The Vioxx Litigation: Disincenting Good Corporate Citizenship Through Misdirected Tort Rules. Here's the abstract:
Though many believe that the tort system incents manufacturers to promote and manufacture their products safely, the Vioxx litigation proves that, in fact, the tort system functions as a disincentive against manufacturer transparency, scientific curiosity, and public safety. This Article examines the differences between Merck's liability for the pain reliever Vioxx and Pfizer's liability for its competing pain reliever, Celebrex. It concludes that the reason for Merck's increased product liability arises from its diligent efforts to protect the public. When Merck published studies examining Vioxx's cardiovascular safety, Merck provided plaintiffs with a wealth of data. By voluntarily withdrawing Vioxx, Merck alerted lawyers and potential plaintiffs to Vioxx's potential for harm. This Article examines several solutions to these perverse incentives, including FDA preemption at the state and federal level, the pending FDA Revitalization Act and FACT Act, Wagner's Burden-Shifting Proposal, and two market-based solutions. The Article concludes with its own market-based solution, which encourages the rapid release of study data and attempts to mitigate the red flag effect that occurs when a manufacturer voluntarily withdraws a potentially dangerous product.