Endo International recently indicated that it would set aside $775 million to resolve thousands of remaining lawsuits regarding the faulty vaginal mesh devices sold by the company. The mesh devices have been linked to numerous accounts of related incontinence and pain, leading the company to cease all sales of the product last year. The $775 million should bring closure to the 22,000 legal disputes that still require settlements. According to the Securities and Exchange Commission, Endo, a company based in Ireland, has spent a total of $2.6 billion on lawsuits filed against the company for issues related to the defective mesh device, which, prior to being discontinued, was known to deteriorate inside patients.
Other Similar Suits
Nonetheless, other companies who have sold similarly defective devices remain embroiled in thousands of lawsuits. Johnson & Johnson, one of the companies, currently has over 50,000 cases to sort through and Boston Scientific Corp. is in the midst of over 40,000 similar disputes.
FDA Intervention and Discontinuation
In 2014, the FDA ordered these companies to commence studies regarding the effects of mesh products on a person’s internal organs. And in 2016, the agency required all companies wishing to sell mesh-implants to submit a pre-market approval (PMA) application. Now, the devices must be proven safe before being sold on the market. After shutting down the mesh product, Endo suffered in the stock market. Stock prices fell by 21 percent right after the closure was made public.
The decision to close the product, rather than sell it to the highest bidder, was strategic in nature: “[B]y shutting down the business as opposed to selling it, we are able to reduce the potential for product liability related to future mesh implants, which would have not been achievable in the event of a sale of the Astora business,” the company said.
Looking forward, the company will use the $775 million to make payments starting in the final quarter of 2017. In 2019, when the company ends the payments, Endo hopes the many legal disputes will be resolved.
Paul Campanelli, CEO of Endo, said in a statement, “We believe it is a very important milestone for Endo to have reached agreements to resolve virtually all known U.S. mesh product liability claims.”
But according to a statement published by Business Insider, the company cannot explicitly promise that the legal disputes will be resolved as anticipated, and thus, Endo “will not report or comment on its progress during a current quarter.” This is due to various externalities such as fluctuations in the market, technological advancements, unforeseen changes in “regulatory decisions,” and of course unpredictable shifts in the legal proceedings.
Transvaginal mesh disputes, when combined, constitute one of the largest mass tort filings in US history. There are currently over 100,000 lawsuits underway in federal courts. 75 percent of those suits are being heard in West Virginia where there are seven multi-district litigation cases in process. The remaining 25 percent are being heard in state courts.
Surely, Endo executives are kicking themselves, as they bought American Medical Systems, the manufacturer of the device, in 2011 for $2.9 billion. Even then, the product was known to be risky and various lawsuits had already been filed. It’s uncertain what the future holds for Endo, but consumer advocates hope the people harmed by the company’s negligence will receive adequate compensation for their injuries.