Eli Lilly and Co. said on Thursday it has agreed to pay up to $500 million to settle 18,000 Zyprexa lawsuits alleging it had failed to adequately warn patients that Zyprexa may increase the risk of diabetes.

“While we remain confident that these claims are without merit, we took this difficult step because we believe it is in the best interest of the company, the patients who depend on this medication, and their physicians,” said Sidney Taurel, chairman of the board and chief executive officer of Eli Lilly and Company. “We wanted to reduce significant uncertainties involved in litigating such complex cases. Our decision to resolve the claims does not change the fact that Zyprexa has and will continue to improve the lives of millions of patients around the world who are suffering from schizophrenia and bipolar disorder. These settlement agreements will enable Lilly to focus first and foremost on addressing unmet medical needs through research, educational programs and partnerships with doctors and patients.”

In June 2005, Lilly agreed to pay about $700 million to settle 8,000 Zyprexa lawsuits in the United States.

The majority of the of the Zyprexa lawsuits claim that before September 2003, the package insert warning about the potential link between Zyprexa and hyperglycemia and diabetes was not adequately displayed.

In September 2003, the Food and Drug Administration required label changes for Zyprexa and all atypical antipsychotics, adding more information warning about a possible link with diabetes.

In 2004, a panel of the American Diabetes Association found that Zyprexa caused diabetes more than other widely used antipsychotic drugs, in part becuase it has a tendency to cause more higher weight gain. However, the FDA has never made a similar finding.