FDA shoots down Merck's Arcoxia

NEW YORK (CNNMoney.com) -- The FDA shot down Merck's application for an arthritis painkiller that has been widely criticized for its resemblance to Vioxx.

The Food and Drug Administration issued Merck (down $0.78 to $51.65, Charts, Fortune 500) a "non-approvable letter" for Arcoxia, the drugmaker said on Friday. The letter said Merck needs to provide more test results showing that Arcoxia's benefits outweigh its risks before it has another chance of getting approved.

Arcoxia is already available in 63 countries and contributed $265 million to Merck's sales in 2006. The painkiller is a member of the same drug class as Vioxx, a former blockbuster that had disastrous consequences for Merck.

Merck pulled Vioxx off the market in 2004 after studies linked the drug to a heightened risk of heart attack and stroke. Since that time, former Vioxx patients and their families have filed about 27,000 lawsuits against Merck, which has vowed to fight the cases one at a time. So far, Merck has won 10 cases in court and lost five.

The FDA's decision to not approve Arcoxia was widely expected. On April 12, a panel of FDA experts voted 20-1 against approval of the drug. This nonbinding was taken into consideration by regulators when they decided to issue Merck the non-approvable letter.

Merck is the third-largest U.S. drugmaker in terms of sales, behind Pfizer (down $0.12 to $26.60, Charts, Fortune 500) and Johnson & Johnson (down $0.05 to $64.19, Charts, Fortune 500).

Correction: An earlier version of this story incorrectly stated that Arcoxia was pulled off the U.S. market.