Novartis Settles claims for $99m
Last night it was reported that Novartis has settled its claims against the reps for a reported $99,000,000.00. My understanding is this will include all reps who opted in to the case previously and reps who worked in New York and California. This would represent the first major settlement of a pharmaceutical overtime case. It should be noted that their claim was settled prior to the Supreme Court weighing in on the issue. While the claims could be worth more, the lawyers for the reps had to take into consideration the risk of loss at the Supreme Court level. We believe the risk is relatively low, despite conventional wisdom of a pro-corporate court, becuase the court over the years has upheld agency action and given deference to it. We expect the same will occur here. Should the reps win in the Supreme Court, I would expect to see $250m or even larger numbers begin to emerge from some of the other companies. It is also conceivable that we will see settlements in the next few months in advance of the opinion as Big Pharma gets nervous and decides to get some closure and change their practices.
