16th Aug 2024 15:34
(Alliance News) - A positive ruling in Florida state court regarding Zantac was seen as an "important" step towards clearing the litigation-related overhang that has dogged GSK PLC.
The London-based pharmaceutical company said on Thursday the court excluded the plaintiff's experts' general and specific causation testimony that ranitidine, known as Zantac, was a significant risk for Wilson's prostate cancer.
GSK said it welcomed the Daubert's ruling and will now seek dismissal of the upcoming Wilson case in Florida, whereby plaintiffs alleged a causal link between ranitidine and prostate cancer.
The Daubert standard in the US provides criteria for evaluating whether expert testimony is admissible.
"Today's decision echoes the December 2022 ruling by Judge Rosenberg in the federal multidistrict litigation, which rejected all expert evidence put forward by the plaintiffs and dismissed all MDL cases alleging bladder, esophageal, gastric, liver, or pancreatic cancer." the company said.
Zantac was a heartburn drug that was pulled off the market in 2020 at the request of the US Food & Drug Administration, after low levels of a "probable carcinogen" were found in samples. The carcinogen, known as NDMA, is not harmful in very small amounts. However, tests showed that there were excessive quantities of NDMA in ranitidine, otherwise known as Zantac. Multiple litigations have followed.
Sean Conroy at Shore Capital said this is another positive outcome for GSK and continues to support the view that there is no reliable evidence that Zantac caused certain cancers and that GSK has strong grounds to continue defending itself in ongoing litigation.
He noted this follows another positive outcome early this month where a jury had found GSK not liable in a case in Illinois State Court.
"We see these recent rulings as important steps towards clearing the litigation-related overhang that has disproportionately weighed on the share price since the demerger of Haleon and overshadowed the improving growth outlook we believe GSK has been delivering."
Conroy said the focal point remains on ongoing litigation in Delaware state court given this covers the vast majority of outstanding cases - around 75,000 claimants in the US.
"Volatility in the share price will likely persist over the near term until there is some further clarity around the size and scope of potential damages. However, we still believe that a worst case, up to around USD30 billion scenario for litigation has continued to be priced into the share and there remains a compelling risk-reward profile on offer."
Conroy has a 'buy' rating on GSK.
Shares in GSK eased 0.4% to 1,590.00 pence in London on Friday.
By Jeremy Cutler, Alliance News reporter
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