Takeda Reaches Agreement to Settle Actos Claims for $2.4 BnBy
Takeda Pharmaceutical Company Limited and its wholly-owned subsidiary, Takeda Pharmaceuticals U.S.A., Inc., have reached an agreement expected to resolve the vast majority of product liability lawsuits pending against Takeda in the US for Actos (pioglitazone HCl), a drug to treat Type II diabetes. Takeda will take a $2.7 billion charge against earnings in the fourth quarter of fiscal year 2014 to cover the settlement and the costs associated with defending remaining cases and for other related litigation. The settlement will become effective if 95% of current litigants and claimants opt into the settlement. Once that threshold is achieved, Takeda will pay $2.37 billion into a settlement fund. However, that figure will rise to $2.4 billion if 97% or more of the current litigants and claimants opt to participate in the settlement.
“Takeda believes that the claims made in this litigation are without merit, and does not admit liability,” said the company in a statement. “Takeda believes the company acted responsibly with regard to Actos, and that Actos has a positive benefit/risk profile for the treatment of Type 2 diabetes. Takeda's decision to settle does not change the company's continued commitment to Actos.” Actos continues to be available as a treatment option in the US, Japan and other countries. Overall, the drug has been approved for use in 95 countries, including the US, Japan, several in Europe, Australia, Brazil, Canada and Russia.
The settlement will reduce financial uncertainties for the company and provides a significant degree of assurance toward resolving a high percentage of the Actos product liability claims. Under the settlement, current litigants and claimants who meet prescribed criteria would receive payouts from the fund. The settlement will not affect Takeda’s ability to pay dividends.