Zantac was originally a popular heartburn drug. From being popular all over the world to being withdrawn from the market due to carcinogenic risks, the years-long litigation disputes can be regarded as a slow and bumpy roller coaster for patients and manufacturers. This storm can be traced back to June 2019. At that time, Valisure discovered and informed the FDA during routine batch testing that the active ingredient ranitidine in Zantac would degrade under certain conditions and produce N-nitrosodimethylamine (NDMA), a Class 2A carcinogen. In September of the same year, Valisure formally submitted a citizen petition to the FDA, requesting the recall of all products containing ranitidine.

Since then, Zantac has been deeply involved in the carcinogenic storm. The FDA further found that the higher the storage temperature or the longer the storage time of Zantac, the higher the risk of exceeding the standard of NDMA, which was originally very low. Therefore, the FDA asked the manufacturer to recall Zantac and withdraw it from the market. Even though Zantac manufacturers accepted the recall order in 2020, the panic and anger of patients have not been calmed.

Since then, manufacturers such as Pfizer, Boehringer Ingelheim and Sanofi have been plagued by endless lawsuits. GSK, as a major original research pharmaceutical company, has been the first to bear the brunt and bear the heaviest fire. The Zantac carcinogenic storm has intensified and reversed. Although in August 2022, GSK stated that there was no evidence of a causal relationship between ranitidine treatment and the development of cancer in patients, the plaintiff in the lawsuit originally scheduled for the first trial of Zantac also applied for a voluntary dismissal when no compensation was received, but this was not enough to dispel investors' concerns, and GSK's stock price plummeted.

Four months later, a federal judge in Florida dismissed the lawsuit on the grounds of deficiencies in the evidence, avoiding about 50,000 local lawsuits for GSK and causing GSK's stock price to rebound by nearly 8%. Until June 3 this year, GSK's stock price fell again by 9.8% in the London market, and its market value evaporated by more than $8 billion, due to the decision of the Delaware court in the United States to continue to hear the Zantac lawsuit. Some industry insiders predicted that GSK might have to pay $2 billion to resolve the claim. By October 9, GSK finally chose to settle, and the amount was far higher than expected, reaching $2.2 billion.

Although GSK has always insisted that Zantac is safe, it cannot withstand tens of thousands of lawsuits for a long time. Other pharmaceutical companies also chose to settle compensation earlier this year. Sanofi agreed to pay $100 million to resolve about 4,000 lawsuits in April, and Pfizer settled more than 10,000 lawsuits related to Zantac's cancer treatment issues with $250 million in May. It is not difficult to see from GSK's years-long dispute that when pharmaceutical companies face such lawsuits, it is not only a challenge to public trust, but also their own financial situation and performance in the stock market will be affected.

With such a big risk, pharmaceutical companies have been sued for product problems in far more cases than Zantac. Take GSK for example. In 2004, it was sued by New York Attorney General Eliot Spitzer for concealing the results of a study on the suicide risk of the antidepressant paroxetine, and its stock price fell. Sanofi was sued for birth defects caused by the anti-epileptic drug Depakine and was sentenced to 450,000 euros in compensation. The Merck Viagra case was entangled for many years and finally paid a fine of 800 million US dollars. Johnson & Johnson's talcum powder carcinogenic case dragged on for more than ten years, and agreed to a sky-high compensation of 8.9 billion US dollars, and then split off its consumer business including talcum powder...

Now it seems that approved drugs may not be safe. The occurrence and fermentation of related lawsuits are not entirely the responsibility of regulatory agencies, but more of a reminder to pharmaceutical companies. First of all, it sounded the alarm for major pharmaceutical companies to strengthen the control of drug safety. In addition to conducting effective clinical trials and safety assessments before listing, it is also necessary to strictly abide by laws and regulations in every link from raw material procurement to product production to delivery, and do a good job of tracking and monitoring. After all, drugs are related to human life safety and cannot be sloppy. At the same time, when facing litigation, pharmaceutical companies should also consider countermeasures comprehensively, taking into account the possible interests, reputation damage and long-term impact, so as to avoid further legal disputes causing greater damage to the company.

GSK said bluntly in this settlement: the settlement is in the best long-term interests of the company and can avoid the risk of continuing litigation. After all, the final result of long-term litigation, whether it is winning the case or paying a huge amount of compensation or settlement money, will not only waste the initial litigation costs, but most importantly, "avoid being distracted by protracted litigation." How to return the focus to core business and new product development may be the best solution for pharmaceutical companies to survive in the fiercely competitive pharmaceutical market.

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