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J&J Returns to Court Tuesday for Possible $4B Settlement Hearing

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Hip implants on a table

Johnson & Johnson returned to an Ohio courtroom Tuesday to discuss resolution of cases involving its recalled ASR hip implants.

Court records show U.S. District Judge David A. Katz, of the Northern District of Ohio, scheduled the open court conference for 4:30 p.m. in Toledo. Although Katz’s order does not include details about the hearing, the expected topic of discussion will likely be the terms of a proposed $4 billion settlement.

Reports show Johnson & Johnson agreed to settle thousands of U.S. lawsuits filed over the company’s recalled hip implants.

Patients who filed lawsuits against the implant maker for its failed DePuy ASR implants could receive about $350,000, depending on factors such as age and medical condition, according to a report in The New York Times.

Approximately 7,000 to 8,000 claims are expected to be a part of this settlement. However, the exact number may change depending on future claims.

The settlement is pending court approval. In order for it to go through, 94 percent of claimants must agree to the deal or it will be withdrawn.

According to lawyers involved in the case, only patients who had to have revision surgery would receive compensation. However, the settlement does not bar people who have problems with DePuy ASR hips in the future.

The injuries claimed by plaintiffs in the lawsuits include dislocation, severe pain, tissue death and excessive levels of metal in the bloodstream. Many patients required revision surgery to replace the failed implants – a procedure that is more complex and carries additional surgical risks.

Some experts feel the amount might not be enough for some patients.

“It’s certainly a lot of money, but there are [a] whole bunch of people who contend these hips caused grievous injuries,” Carl Tobias a product-liability law teacher at the University of Richmond in Virginia told Bloomberg. “So some of them may feel like this isn’t enough compensation for what they’ve gone through.”

The DePuy ASR was recalled in 2010 after studies showed an above average failure rate. The latest data from Australia, the country that first called attention to the problems with the ASR, shows a 44 percent failure rate within seven years.

The New York Times called it “one of the biggest medical device failures in recent decades.”

J&J’s DePuy Orthopaedics unit did not comment on the proposed deal.

Mounting Costs and Legal Battles

Before the $4 billion settlement, J&J already racked up nearly $1 billion in costs related to the recall of the ASR. Approximately 93,000 of the devices were sold worldwide.

If the deal goes through, J&J will have paid more than $6 billion this month to settle claims against its drug and medical device products.

Earlier this month, the pharmaceutical giant agreed to pay $2.2 billion to settle criminal charges for improperly marketing Risperdal, its anti-psychotic medication, for unapproved uses.

Some critics of J&J don’t see the latest settlement as a true good faith effort.

Michael Weinstein, president of AIDS Healthcare Foundation (AHF), released this statement regarding the $4 billion settlement: “In a two week period, Johnson & Johnson, one of America’s most trusted brands, will have racked up over six billion dollars in fines and legal settlement costs for its wrongdoing — six billion dollars. The fact that Johnson and Johnson can so readily consent to billion-dollar fines and/or legal settlements shows both the incredible wealth — and greed — of the pharmaceutical industry.”

The AIDS foundation and the drug manufacturer have clashed in the past. AHF in October sued J&J for overcharging the foundation as much as $2 million for HIV/AIDS drugs between 2005 and 2012.

J&J’s Hip Implant Trial Wins, Losses

Tobias told Bloomberg the $4 billion proposal would take care of “a lot of litigation that could have dragged on for years, and cost J&J much more money in the long run.”

So far, J&J lost one hip implant trial and won another – both were state cases.

Loren Kransky, a retired prison guard from Montana, filed the first ASR lawsuit against DePuy that went to trial. Kransky alleged the metal hip implant caused him to suffer severe pain, sent excessive metal ions into his blood, and forced him into a wheelchair. A California jury awarded Kransky $8.3 million after they determined DePuy was negligent, and the ASR was defective.

In the second state trial in Chicago, the jury ruled in favor of DePuy.

The first federal lawsuit was scheduled to go to court in September, but was settled before it went to trial. The company also settled another state case before trial for an undisclosed amount.

During Kransky’s trial, internal documents surfaced showing that DePuy knew about the ASR’s high failure rate and design flaws, but did not inform the public.

If the settlement is not approved, the company may still face the possibility of several new trials with large damage awards for the ASR. The company also faces several thousand lawsuits for its Pinnacle hip implant, which the company phased out in 2013.

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