The Delaware State Court said that cancer patients who say the heartburn drug Zantac caused their illness can have jury trials. This caused GSK shares to drop the most in almost two years.
FactSet data shows that GSK’s London-listed shares GSK, -9.31% GSK, +1.70% dropped by 9.5%, which was the biggest drop in a single day since August 11, 2022, when they dropped 10.1%.
GSK said it would use the decision as an example in court.
According to 16 epidemiological studies that looked at data from people who took ranitidine, there is no consistent or reliable evidence that it raises the risk of any cancer. This was said by the U.K. drugmaker using the drug’s scientific name.
Zantac was taken off the market in the U.S. and other places in 2020 because it was tainted with a chemical that is likely to cause cancer.
GSK said that the decision won’t change its plans for investments or how it spends its capital.
The court in Delaware ruled on 75,000 cases, and 72,000 of them named GSK. The ruling also lets experts give their opinions.
Analysts at JPMorgan say the liability is probably higher than the $2 billion to $3 billion that the market thought it would be.
They said that the market thought the hearing would limit the evidence that could be used to just five types of cancer and about 7,000 plaintiffs. They now think there is a 50% chance that Zantac will have to pay $5 billion.
Sanofi SAN, -0.91%, Pfizer PFE, +1.63%, and Boehringer Ingelheim are some of the other companies that have been sued. GSK spinoff Haleon HLN, -0.18% has also said it may have liabilities.
