GSK plc (LSE/NYSE: GSK) announced on October 9, 2024 that it has reached agreements with 10 plaintiff firms who together represent 93% (approximately 80,000) of the Zantac (ranitidine) state court product liability cases pending against GSK in the United States.
Under these agreements, GSK will make an aggregate payment of up to $2.2 billion to resolve all U.S. state court product liability cases handled by those plaintiff firms that meet agreed eligibility and participation criteria (the “State Courts Settlement”).
The participating plaintiff firms are unanimously recommending to their clients that they accept the terms of the State Courts Settlement, which is expected to be fully implemented by the end of H1 2025. Terms of the agreements are confidential.
GSK also confirmed that it has reached an agreement in principle to pay a total of $70 million to resolve the Zantac qui tam complaint previously filed by Valisure. The agreement in principle is subject to final approval from the Department of Justice (the “Qui Tam Settlement”).
GSK has not admitted any liability in the State Courts Settlement or in the agreement in principle for the Qui Tam Settlement. GSK stated: “While the scientific consensus remains that there is no consistent or reliable evidence that ranitidine increases the risk of any cancer, GSK strongly believes that these settlements are in the best long-term interests of the company and its shareholders as they remove significant financial uncertainty, risk and distraction associated with protracted litigation.”
GSK expects to recognise an incremental charge in its Q3 Results for 2024 of £1.8 billion ($2.3 billion) in relation to the State Courts Settlement, the Qui Tam Settlement, and the remaining 7% of pending state court product liability cases, partially offset by expected reduced future legal costs.
The costs of these settlements will be funded through existing resources. There are no changes to GSK’s growth agenda or investment plans for R&D as a result of these settlements.
Ranitidine
The FDA announced on April 1, 2020: “The U.S. Food and Drug Administration today announced it is requesting manufacturers withdraw all prescription and over-the-counter (OTC) ranitidine drugs from the market immediately. This is the latest step in an ongoing investigation of a contaminant known as N-Nitrosodimethylamine (NDMA) in ranitidine medications (commonly known by the brand name Zantac). The agency has determined that the impurity in some ranitidine products increases over time and when stored at higher than room temperatures and may result in consumer exposure to unacceptable levels of this impurity. As a result of this immediate market withdrawal request, ranitidine products will not be available for new or existing prescriptions or OTC use in the U.S.”
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