NEW YORK, July 3, 2002 (PRIMEZONE) -- Wolf Popper LLP announced today that it has filed a class action complaint on behalf of purchasers of the securities of Merck & Co., Inc. ("Merck" or the "Company") (NYSE:MRK) between July 1, 1999 and June 21, 2002, inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Wolf Popper's website: www.wolfpopper.com
The action is pending in the United States District Court, District of New Jersey, located at Martin Luther King, Jr. Federal Building and U.S. Courthouse, 50 Walnut Street, Newark, New Jersey 07101, against defendants Merck, Kenneth C. Frazier, Richard C. Henriques, Raymond V. Gilmartin, Judy C. Lewent and Mary M. McDonald.
The Complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between July 1, 1999 and June 21, 2002, thereby artificially inflating the price of Merck securities. The complaint alleges that, throughout the Class Period, defendants issued numerous statements and filed quarterly and annual reports with the SEC that described the Company's increasing revenues and financial performance. As alleged in the complaint, these statements were materially false and misleading because they failed to disclose and/or misrepresented: (i) that the Company had materially overstated its revenues (by roughly $4.6 billion in year 2001 alone) by improperly including the value of co-payments made by consumers to their pharmacies (inasmuch as Merck had no rights or liabilities with respect to the co-payments); (ii) that the financial statements prepared and filed by defendants during the Class Period were not prepared in accordance with Generally Accepted Accounting Principles ("GAAP") because neither Merck nor its Medco unit ever received any revenue from the co-payments that were made to pharmacies; and (iii) that as a result, defendants' statements concerning the size of the Company's revenues and financial results lacked a reasonable basis at all relevant times.
On June 21, 2002, The Wall Street Journal published an article that revealed that Merck had boosted its reported revenues by roughly $4.6 billion in year 2001 alone by improperly including as revenue the value of co-payments made by consumers with a prescription-drug card to their pharmacies to cover their portion of the cost of a prescription under an insurance plan.
Following this report, shares of Merck fell $2.22 per share to close at $49.98 per share, on volume of more than 15.2 million shares traded, or more than twice the average daily volume.
Any member of the proposed class who desires to be appointed lead plaintiff in this action must file a motion with the Court no later than August 30, 2002. Class members must meet certain legal requirements to serve as a lead plaintiff. If you have questions or information regarding this action, or if you are interested in serving as a lead plaintiff in this action, you may call or write:
Wolf Popper LLP, Robert C. Finkel, Esq. 845 Third Avenue, New York, NY 10022-6689
Tel.: 212.451.9620, Toll Free: 877.370.7703; Fax: 212.486.2093, Toll Free: 877.370.7704
Email: irrep@wolfpopper.com; website: www.wolfpopper.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca