Yaz Lawsuit Settlement: Bayer to Pay $1 Billion Plus to Settle Yasmin Litigation

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(Newswire.net — March 23, 2013) New York, NY — Bayer AG the German pharmaceutical giant continues to claim they don’t believe Yasmin or Yaz has an increased risk of side effects when compared to other brands of oral contraceptives; even after the FDA ordered them to revise product labels to increase warnings regarding the risk of blood clots and complications from blood clots.

But it was noted in the Bayer annual report filed in February that it had reached an agreement to pay $1 Billion to settle claims by 4,800 women who believe the medication Yaz caused blood clots which resulted in heart attacks, strokes and other serious ailments; including more than 100 deaths.

This same annual report announced sales revenue in 2012 in excess of $51 Billion dollars, so the settlement represents less than 2% of sales. This small financial hit in combination with the increased certainty created by the legal settlement explains why there has been no negative impact on the share price of Bayer stock. In fact, the stock price is at an all time high. According to their annual report, “Bayer stock rose 46 percent during the year. The stock performance came in at 50 percent, placing it well ahead of the DAX. Bayer stock ended 2012 at €71.89, only just below its high for the year of €72.95, which was also its all-time high at that point.”    

As of March 2013 Bayer is facing more than 13,600 lawsuits in the US with additional suits beginning to be filed in Europe. Any woman who experienced serious side effects after taking Yasmin, Yaz or Ocella may be entitled to financial compensation.

Bayer explains in their 2012 Annual Report, “The number of claimants in the pending lawsuits and claims totaled about 13,600 (excluding claims already settled). Claimants allege that they have suffered personal injuries, some of them fatal, from the use of oral contraceptive products such as Yasmin™ and/or YAZ™. Claimants seek compensatory and punitive damages, claiming, in particular, that Bayer knew, or should have known, of the alleged risks and should be held liable for having failed to disclose them or adequately warn users.”    

Yasmin was first introduced to the US marketplace in 2001 by Berlex Laboratories the company that developed the drug. It was bought by Bayer in 2006 and touted as a new type of oral contraceptive with the added benefits of improved acne and improved PMS symptoms. Bayer launched an aggressive ad campaign, which created strong demand and made Yaz the number one selling birth control in 2009. The FDA believed the marketing was misleading to both doctors and their patients, because it minimized the side effects and risks. They believed this was due in part to the TV commercials which used special effects like quick cuts, bright colors and edgy music. These techniques focused consumer attention on the main benefits, while deflecting attention from the negative product disclosures. Bayer agreed to support a $20 million ad campaign to correct the product misperceptions and to avoid FDA sanctions. 

In spite of all this negative press the Bayer AG stock continues to rise. It appears the company has moved past this latest crisis unscathed.