Four Drug Firms Settle for $260M to Avoid Opioid Trial

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Four drug companies reached a reported $260 million, last-minute settlement to avoid a trial in Cleveland seeking to blame them for fueling the opioid crisis, the Wall Street Journal reports. Details of the settlements with McKesson Corp., Cardinal Health Inc., AmerisourceBergen Corp. and Teva Pharmaceutical Industries Ltd. are scheduled to be announced Monday.

A fifth defendant, Walgreens Boots Alliance, hadn’t yet reached a deal Monday morning, making it unclear if a trial would proceed against just that company.

U.S. District Judge Dan Polster said broader talks to settle all the cases were continuing. Polster, who has urged a settlement for nearly two years, said the two-county deal announced Monday was reached sometime between midnight and 1 a.m. Going to trial could have cost the drug companies more than $8 billion if Cuyahoga and Summit counties were awarded all the money they were seeking.

The Ohio counties would receive $215 million in cash from the distributors and another $20 million from Teva, the Washington Post reports. Teva would supply another $25 million in anti-addiction medication.

A sixth defendant, Melville, N.Y.-based Henry Schein Medical, announced Monday that it had reached a deal worth $1.25 million with the two counties.  The Journal reported earlier that lawyers for cities and counties were demanding more money from major drug distributors, holding up the wide-ranging settlement of opioid litigation.

The two Ohio counties had been chosen to serve as a bellwether to help guide how to resolve the rest of the litigation. More than 200,000 people have died of overdoses of prescription narcotics in two decades and another 200,000 have succumbed to overdoses of heroin and illegal fentanyl, which is now the main drug fueling the crisis.

The settlement “is the latest in a flurry of agreements reached by drug companies to avoid the landmark federal trial, which was to serve as a test case for legal arguments and evidence in a yearslong attempt to hold the pharmaceutical industry accountable,” according to the New York Times.

Other companies that already reached a settlement to avoid that trial include Johnson & Johnson; Mallinckrodt Pharmaceuticals, one of the biggest manufacturers of generic opioids; and Purdue Pharma, which has been widely blamed for igniting the opioids crisis with misleading marketing of its drug OxyContin.

An Oklahoma judge ruled this August that Johnson & Johnson and its subsidiaries helped fuel the state’s opioid crisis and ordered the consumer products giant to pay $572 million, more than twice the amount another drug manufacturer agreed to pay in a settlement.

Cleveland County District Judge Thad Balkman said the company “bears responsibility…by aggressively marketing painkillers.”

Balkman wrote that Johnson and Johnson’s Janssen “engaged in false and misleading marketing of both their drugs and opioids generally, and the law makes clear that such conduct is more than enough to serve as the act or omission necessary to establish the first element of Oklahoma’s public nuisance law.”

 

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