Los Angeles Times, Times Mirror Square, Los Angeles, CA 90053 - Los Angeles Times (LT) - FRIDAY May 31, 1996 Edition: Home Edition Section: Business Page: 1 Pt. D Word Count: 797
Martha Groves; Times Staff Writer

For the Record

HIV settlement--Four drug makers have reserved the right to withdraw from a proposed $640-million settlement to satisfy legal claims by people with hemophilia who became infected with HIV from tainted blood supplies. A company could withdraw if, in its opinion, too many individuals chose to forgo the settlement and instead pursue their cases in court. However, the companies agreed to proceed with the deal if no more than 150 individuals choose to "opt out." A story in Friday's Business section indicated that there is no limit on such opt-out cases.

TEXT: Hoping to close a tragic chapter in the AIDS saga, representatives of thousands of hemophiliacs infected with HIV from tainted blood products told four drug makers Thursday that they are prepared to accept a modified $640-million settlement.

Under the plan, the companies would pay as much as $40 million in legal costs plus $100,000 each to about 6,000 U.S. hemophiliacs who became infected with human immunodeficiency virus from contaminated blood-clotting medications.

The agreement would permit infected hemophiliacs who choose not to accept the payment to pursue their own cases in court. That provision is a change from a previous plan, proposed in April, that would have limited the number of such "opt-out" cases to 100.

"In some ways, this is an important victory," said Corey Dubin of Goleta, Calif., president of the Committee of Ten Thousand, a nationwide activist group. "The industry is finally listening."

Although decrying the proposed payments to individuals as inadequate given the scope of the trauma--and given a much higher per-person settlement reached recently for hemophiliacs in Japan--advocates said the agreement at least would put money in the hands of families that have been emotionally and, in some cases, financially drained by the crisis.

"This holocaust infected three generations (of hemophiliacs), and infected hemophiliacs are dying at the rate of two a day," said Wayne Swindlehurst, a hemophiliac with AIDS who is vice president of the Committee of Ten Thousand. "If people want to take their infected kids to Disney World or buy them a color TV, now they can."

The four companies, which did not admit liability, are Baxter International Inc. of Deerfield, Ill.; French-owned Rhone-Poulenc Rorer Inc.; Germany's Bayer; and Japan's Green Cross Corp., whose U.S. division is Alpha Therapeutics in Los Angeles.

Guy Esnouf, a spokesman for the pharmaceutical companies, said lawyers for the hemophiliac community had endorsed the proposal and that "we're now working together to take this quickly for court approval." The next scheduled court hearing on the matter is Tuesday in Chicago.

Hemophilia is a hereditary disorder passed from mother to son--it afflicts men almost exclusively. Affected individuals can suffer prolonged bleeding even from minor cuts and injuries. The traditional treatment has been transfusions of blood containing substances that aid in clotting.

Soon after AIDS began sweeping through the gay community, hemophiliacs became concerned that transfusions could put them at risk. Initially, government and industry officials sought to reassure them that there was little risk of infection.

Most of those infected received contaminated transfusions in the early 1980s, when little was known about AIDS.

By the end of 1993, the U.S. Centers for Disease Control and Prevention had documented 3,342 AIDS cases among hemophiliacs. Already, an estimated 4,500 people have died. The epidemic has shortened the median life expectancy of a person with hemophilia to 40 years in 1989 from 57 in 1979. Initial projections were that half the 20,000 U.S. hemophiliacs were HIV-positive. But, Swindlehurst said, a recent CDC study tallied up 7,726 infected individuals, including hemophiliacs as well as their wives, children and "significant others."

After years of watching HIV destroy their community in the United States and other developed countries that imported the U.S.-made blood-clotting concentrate, hemophiliac activists went on the legal offensive in the early 1990s. One suit won certification as a class action, but a federal judge ordered the class decertified in January.

Drug makers have prevailed in 13 court cases; plaintiffs have won two cases that are under appeal.

In mid-March, Baxter, Bayer, Green Cross and two other companies joined the Japanese government in settling with more than 400 Japanese hemophiliacs who had become infected with HIV. Each individual will receive $420,000 plus an estimated $1,425 monthly payment for life. Of that, the industry's portion was $250,000 per person.

Meanwhile, Dubin had arranged a lunch with a key Baxter executive. Dubin, who is HIV-positive but has not displayed symptoms of AIDS, pointed out that activists had uncovered evidence that the companies had knowingly depended on high-risk populations such as prisoners and drug users for much of their plasma supply, despite the dangers.

The two men agreed that the opponents should begin secret negotiations. Today, both the industry and the hemophiliac community said they can take some satisfaction in the results.

Esnouf, the industry spokesman, said the companies' objective is to get support quickly to those affected and to "attain closure."

Swindlehurst, who said the federal government shares some blame in not protecting the nation's blood supply in the early years of the AIDS epidemic, predicted that some infected hemophiliacs or their families will push their cases in the courts to "let the world know" what happened.

"All of these people should get $1 million," said Thomas Mull, a lawyer for hundreds of hemophiliacs. "But that's not going to happen."

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