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(Alliance News) - GSK PLC and Sanofi SA came out swinging on Thursday after sharp share price declines over Zantac litigation concerns.
Shares in GSK fell 10% to 1,400.00 pence in London on Thursday and consumer health spin-off Haleon declined 4.9% to 265.80p. In Paris, Sanofi fell 3.3% to EUR84.75.
Ranitidine, sold under the name Zantac, was sold over-the-counter in the US by French drugmaker Sanofi and was originally manufactured by GSK.
The product was withdrawn after the US Food & Drug Administration, in 2019, warned that Zantac contained levels of NDMA, a probable human carcinogen - a substance which has been linked to cancer.
In late 2019, Sanofi recalled the over-the-counter treatment in the US and Canada over possible contamination fears. By April 2020, the FDA had ordered the drug and all its generics be withdrawn from drugstore shelves.
Sanofi said that as of August 1, it was aware of 2,850 personal injury plaintiffs in the US. When factoring in additional Zantac cases that do not include Sanofi, this number rises to 3,450.
The firm noted that there are other potential personal injury claimants who, in lieu of filing a court case, have instead joined a registry of "unfiled" claims. "Over time, the number of unfiled claims alleging either Rx and/or OTC use and implicating a variety of defendants in these actions has exceeded 150,000 – a significant number of these claims, however, do not implicate Sanofi," it said.
GSK, meanwhile, said it has been named as a defendant in around 3,000 filed personal injury cases in US federal and state court and "numerous" unfiled claims. Class actions have also been filed, it said.
Outside the US, there are "several class actions and in excess of 100 personal injury cases" pending against GSK in Canada, along with a class action in Israel.
Among the state court cases naming GSK, trials in Madison County, Illinois are to proceed on August 22, 2022, and February 2023. A trial in California is currently scheduled to begin on February 13, 2023.
"Whilst GSK has served Haleon with notice of potential claims in relation to possible liabilities connected to OTC Zantac under the relevant indemnification provisions, contained in the documentation relating to the formation of the Consumer Healthcare JV, it is not possible, at this stage, to meaningfully assess whether the outcome will result in a probable outflow, or to quantify or reliably estimate what liability (if any) that Haleon may have to GSK under the relevant indemnities," it said.
Haleon is a spin-out of GSK's consumer healthcare business, the demerger having completed less than a month ago. When the consumer healthcare arm was a part of GSK, it was 68% owned by GSK and 32% by US peer Pfizer Inc.
Both GSK and Sanofi were confident in the science backing their cases, citing studies from the US Food & Drug Administration and European Medicines Agency which found no evidence that ranitidine causes cancer.
"There is no reliable evidence that Zantac causes any of the alleged injuries under real-world conditions, and Sanofi remains fully confident in its defenses," said Sanofi.
Sanofi said that, given the strength of its case and uncertainty over future proceedings, no contingencies have been established.
GSK said: "The overwhelming weight of the scientific evidence supports the conclusion that there is no increased cancer risk associated with the use of ranitidine. Suggestions to the contrary are therefore inconsistent with the science, and GSK will vigorously defend itself against all meritless claims alleging otherwise."
By Lucy Heming; lucyheming@alliancenews.com
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