More than 50 years after the morning sickness drug Thalidomide was first released to the market, the drug’s British distributor announced on Monday, December 2nd that it has agreed to settle an Australian class action in the Victorian Supreme Court over birth defects linked to the drug.  The legal team representing the class claimed that Australia had been targeted as a top priority market for Thalidomide.

Thalidomide was originally marketed to pregnant women as an anti-morning sickness drug in the 1950s.  The drug was pulled from the market shortly after its release when it was found to have caused severe physical deformities in thousands of babies across the globe.  Yet—over 50 years later—Thalidomide litigation is only now coming to a close.  Other settlements involving Thalidomide have already been reached in the U.K. in 2010 and in Spain last month.  It is estimated that 10,000 children worldwide, many of which were born without arms or legs, suffered deformities resulting from the drug.

Under the terms of the settlement, a class of roughly 100 victims in Australia and New Zealand will receive $89 million Australian dollars (equivalent to $81 million in U.S. dollars) as compensation from Diageo Scotland Ltd.  The settlement is also intended to provide the class members with guaranteed care for the rest of their lives.  Thalidomide was marketed in Australia by the now-defunct firm Distillers Company, a subsidiary of Diageo.  The German manufacturer of the drug, Grünenthal, settled a lawsuit in 1972 in which it expressed regret to the victims but refused to admit liability, arguing that it had conducted all necessary clinical trials.  Pursuant to Monday’s settlement, the suit in Australia against Grünenthal will be discontinued.  Peter Gordon, an attorney representing the class, praised Diageo and noted that while Diageo did not itself distribute Thalidomide in Australia, it did the right thing by negotiating the settlement.  The settlement is still subject to Australian court review and will be heard in February.