Merck has reached near the end of the line with its Vioxx-like replacement drug. On Thursday, an advisory panel at the Food and Drug Administration voted overwhelmingly to reject Arcoxia, a painkiller developed by Merck intended to treat arthritis. The agency usually follows the recommendations of its panels, but it is not required to. A final F.D.A. ruling on Arcoxia is expected later this month. Vioxx, also from Merck, was pulled from the market in 2004 after it was found to increase risk of heart attacks and strokes.

David Graham, an F.D.A. scientist, spoke out against Arcoxia to members of the F.D.A. panel. He said that the drug could become a "potential public health disaster" with a similar impact as Vioxx had, according to the Wall Street Journal. Merck is currently facing some 28,000 lawsuits tied to Vioxx. So far, it has won 10 trials and lost five.

Anti-inflammatory drugs, also sometimes called Cox-2 inhibitors, are known to carry increased risk of cardiovascular problems in the eyes of the F.D.A. A similar new drug "would not be appropriate for marketing unless the product fills an unmet medical need for a particular patient population that has no relatively safer approved products available to them," the F.D.A. stated in briefing documents, according to the Journal.

But Merck insists that osteoarthritis is a condition with unmet medical needs, and as the population ages it will only become worse. "We continue to believe that Arcoxia has the potential to become a valuable treatment option for many Americans suffering from osteoarthritis," said Peter Kim, president of Merck Research Laboratories, in a statement. The pharmaceutical giant hasn't thrown in the towel yet, and said it will continue to work with the F.D.A. to gain regulatory approval.

There are already 20 anti-inflammatory drugs available that commonly treat osteoarthritis, according to the Associated Press. Approximately 21 million Americans have the condition.

Merck submitted data from a long-term study involving 34,000 patients and it says the results showed the drug's "overall benefit to risk profile is favorable." Arcoxia is widely available outside of the U.S., in 63 different countries, and Merck will continue to market it where it's been approved. The drug had global sales of $265 million in 2006, according to Reuters.

Just hours after expressing its disappointment about the F.D.A. panel ruling, the company raised its profit forecast for the first quarter and full year 2007 due to strong sales across products. Merck is in the middle of a planned restructuring to save as much as $5 billion in costs through 2010.  Merck stock fell slightly in after hours trading on Thursday.