GSK shares rise on Delaware Supreme Court appeal in Zantac case

Investing.com -- Shares of GSK plc (LON:GSK ) rose on Wednesday after the Delaware Supreme Court granted the company’s request for an interlocutory review of the Delaware Superior Court's decision, which had permitted the introduction of plaintiffs' expert evidence at trial.

At 4:31 am (0831 GMT), GSK was trading 1.5% higher at £1,642.11.

The litigation at the center of this legal battle revolves around allegations that ranitidine, the active ingredient in Zantac, may be linked to an increased risk of cancer. 

“In our view, the interlocutory review by the DE SC is positive because GSK’s appeal met the high bar to hear the case, implying a reasonable chance the decision could be overturned,” said analysts at Guggenheim in a note. 

GSK continues to maintain its stance that there is no conclusive scientific evidence linking ranitidine, the active ingredient in Zantac, to an increased risk of any cancer, as stated in an exchange filing. This position is supported by numerous epidemiological studies involving over 1 million patients that have been conducted since 2019.

“If Judge Medinilla’s decision is overturned, we believe a potentially benign and certainly much reduced settlement amount/liability threat would have a good chance of occurring shortly thereafter,” analysts at Guggenheim said. 

GSK reaffirmed its commitment to aggressively defend itself and to manage the litigation in the best interests of the company and its shareholders in response to the Delaware Supreme Court's ruling. 

The company will now proceed with the Delaware litigation in parallel with the Supreme Court review.

In addition to the appeal, GSK will press additional defenses in the litigation, including failure to provide proof of use and proof of diagnosis requirements recently ordered by the Court.

Source: Investing.com