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Tuesday, August 23, 2005

When punishment is the crime

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By

The story from Angleton, Texas, is -- well, you know by now: Merck & Co. killed Robert C. Ernst.

In fact, there's a far bigger story: "Runaway Texas jury consigns untold thousands to pain, suffering and, for all anyone now knows, death." Not the most economical headline you ever read but true -- deadly true.

The Vioxx decision last week is about as malignant a piece of legal mischief as we know of. Hardly for the first time, a jury got suckered by a semi-charismatic plaintiffs' lawyer --who hired a "jury psychologist" to help gauge his performances, which included quoting the Bible with impressive enthusiasm.

Mark Lanier had the jurors eating out of his hand. Twenty-four million big ones the jury assigned Robert Ernst's widow, with another $229 million thrown in for punitive damages. "Punitive" means tailored as punishment. Merck sagged beneath the blows of the bullwhip. Its stock fell almost 8 percent.

Analysts took to questioning whether -- even after this particular judgment is cut 90 percent in accordance with Texas law -- Merck can survive the estimated thousands of lawsuits it still faces. This is because, though the Angleton jury seemed nonchalant at the reality of the thing, economics says a company must make a profit.

Milk Merck hard enough, and you've got something more than thousands of lost jobs; you've got a shutdown of medical research -- at Merck, of course; but also at other pharmaceutical companies understandably distracted by the prospect of going broke because some jury or other points the finger at them. No one can do business this way, least of all perhaps the pharmaceuticals, whose lead time between lab research and sales is, potentially, decades.

I got on Merck's Web site (www.merck.com) just to see what else besides Vioxx -- which Merck, perhaps imprudently, withdrew from the market 11 months ago in response to tests that raised important safety questions -- it's working on. You can take all this with a handful of salt if you don't trust pharmaceutical companies. And yet how offhanded really is it possible to be concerning research projects such as:

• The accelerated filing of "two new vaccines, which are intended to help prevent disease from occurring in the first place."

• "A new kind of treatment for Type 2 diabetes."

• "A new vaccine for treating shingles."

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