On December 12, 2007 the Court issued final approval for the settlement. The Settlement with Defendants Merck Serono International, S.A., Serono Laboratories, Inc., and EMD Serono, Inc. (“Serono Defendants”), in two consolidated class action lawsuits pending in the U.S. District Court for the District of Massachusetts. (In January 2007, Serono International S.A. changed its name to Merck Serono International S.A., and Serono Inc. changed its name to EMD Serono, Inc.) The Claims Administrator anticipates distributing settlement checks to Consumers in early 2008 and to Third Party Payors during the summer of 2008 .
The lawsuits involve the drug Serostim. Serostim is a growth hormone approved by the FDA to treat HIV/AIDS patients with wasting or cachexia. The lawsuits claim that the Serono Defendants encouraged doctors to prescribe Serostim based on diagnostic criteria that were not approved by the FDA, and for purposes other than those indicated. The Serono Defendants deny these claims and any liability. The Serono Defendants have many defenses to these claims, and have entered into the Proposed Settlement solely to avoid the further expense, inconvenience, burden, and uncertainty of these lawsuits.
Of the total settlement amount of $24 million, $21.6 million will be allocated to claims submitted by third-party payors, such as insurance companies and workplace-based health plans; and $2.4 million will be allocated to claims by consumers. After deducting attorneys’ fees and costs of administering the Proposed Settlement, the funds allocated to consumers will be distributed in cash to consumers who: (a) paid for all or part of the cost of the drug, and (b) submit a valid claim form, and the balance, net of attorneys’ fees and the costs of administering the Proposed Settlement, will be distributed to third-party payors who made payments for Serostim.
The names of the lawsuits are Government Employees Hospital Association, et al. v. Serono International, S.A., Serono Laboratories, Inc., Serono, Inc., RJL Systems, Inc., and Rudolph J. Liedtke, C.A. No. 05-cv-11935 (PBS) (D. Mass.), and Eugene Francis v. Serono Laboratories, Inc., Serono, Inc., RJL Systems, Inc., and Rudolph J. Liedtke, C.A. No. 06-cv-10613 (PBS) (D. Mass.).