U.S. health advisers voted on Wednesday to keep GlaxoSmithKline's Avandia diabetes drug on the market, with a majority of those in favor recommending the treatment carry additional warnings.
Shares of the company rose 2 percent after the vote, which serves as a recommendation for a later decision by the U.S. Food and Drug Administration.
Below are some initial reactions from industry analysts, lawyers and doctors.
MIKE WARD, ANALYST, AMBRIAN PARTNERS IN LONDON
This draws the teeth from the threat posed by the remaining litigants hoping for a nasty vote against Glaxo. Earlier speculation of liabilities of up to $6 billion are history -- it might get to $1 billion, but Glaxo is a strong beast with extensive provisions. It had net cash flow in the first quarter of 2.1 billion pounds, which was up 22 percent.
I think Glaxo shares will get a nice bounce in London in the morning.
DR. ALAN KADISH, PRESIDENT AND CEO, TOURO COLLEGE, NEW YORK
Very clearly, even if Avandia is not removed from the market, physicians will now be much more reluctant to prescribe it, and patients to take it. There will be a substantial reduction in use of Avandia.
The vote reflected mixed evidence regarding safety, and that's why it was a complicated split. This was an advisory panel, and now the FDA must issue the final decision. But it will be a very tough decision for the FDA because they got very mixed guidance from the panel.
LES FUNTLEYDER, ANALYST, MILLER TABAK & CO
In general it's a positive for Glaxo. The fact that everyone is having so much trouble with the data means there is no one obvious answer. That's why they're keeping it on the market, with apparently additional restrictions.
The reason we had this meeting is that the data weren't black and white. Doctors want the option to keep it, but fewer will use it than they otherwise would because of today's meeting.
LINDA BANNISTER, ANALYST, EDWARD JONES
If they have to change the label somewhat, we're not as concerned about that. This product's revenue has already fallen significantly because of concerns about safety. Unless the drug is pulled we're not concerned we're going to see this drug be cut in half again.
If the drug is not pulled from the market, we do not expect a spike in litigation costs for GlaxoSmithKline.
From a patient standpoint you want to have confidence in the products you're taking. After Vioxx people naturally are nervous about taking medications because they're fearful of potential safety issues. Allowing this drug to remain on the market is kind of a vote of confidence for the clinical trial process and the ability of these companies to monitor these products after they're on the market.
PROFESSOR CARL TOBIAS, UNIVERSITY OF RICHMOND
Tobias said it was not very clear how the advisory panel's votes might affect litigation against Glaxo over Avandia.
I do think there were concerns that were raised, some of which the company was able to argue against. Whether it was persuasive or not is not clear.
In the cases that proceed, the lawyers for the plaintiffs will try to show that the company knew about certain risks and didn't take those into account.
(Reporting by Lewis Krauskopf, Ransdell Pierson, Grant McCool and Ben Hirschler; Editing by Michele Gershberg)