"In addition, in November, the Company was advised by the staff of the Securities and Exchange Commission (SEC) that it was commencing an informal inquiry concerning Vioxx. Also, the Company has received a subpoena from the U.S. Department of Justice requesting information related to the Company’s research, marketing and selling activities with respect to Vioxx in a federal healthcare investigation under criminal statutes. The Company will cooperate with the SEC and the Justice Department. The Company cannot predict the outcome of these inquiries, however, it is possible that highly unfavorable outcomes, including a potential civil disposition from the SEC and/or potential civil or criminal dispositions from the Justice Department, could have a material adverse effect on the Company’s financial position, liquidity and results of operations.
"The Company currently anticipates that one or more of the Vioxx Personal Injury Lawsuits may go to trial in the first half of 2005. The Company cannot predict the timing of any trials with respect to the Vioxx Shareholder Lawsuits. The Company believes that it has meritorious defenses to the Vioxx Lawsuits and will vigorously defend against them. In view of the inherent difficulty of predicting the outcome of litigation, particularly where there are many claimants and the claimants seek indeterminate damages, the Company is unable to predict the outcome of these matters, and at this time cannot reasonably estimate the possible loss or range of loss with respect to the Vioxx Lawsuits. The Company has not established any reserves for any potential liability relating to the Vioxx Lawsuits. A series of highly unfavorable outcomes could have a material adverse effect on the Company’s financial position, liquidity and results of operations." [Emphasis Added]
