Companies reach tentative deal to settle opioids lawsuit

Cheryl Sanders
October 22, 2019

Under the terms of the deal, the OH counties would immediately receive a combined $215 million in cash from the drug distributors.

It also included Israel's Teva, one of the world's largest generic drug manufacturers.

The company then reached a separate deal in the Cleveland case to pay the 2 counties $20.4 million.

The companies, which have denied wrongdoing, are accused of ignoring suspicious orders and downplaying the risks of opioids, which have been linked to about 400,000 overdose deaths in the USA between 1997 and 2017.

"When we filed this lawsuit almost two years ago, we did so on behalf of every family who couldn't do it for themselves and on behalf of all the communities who feel this epidemic every day". Teva declined to comment.


On Friday they rejected a previous version of the deal crafted by the four states, North Carolina, Texas, Tennessee and Pennsylvania, judging the original $18 billion in cash over 18 years as too small, lawyers' fees too high, and distribution of the funds designed more to help state governments and less communities most impacted by the crisis.

"We are not surprised to see distributor shares giving back some of last week's gains as uncertainty persists in this extremely complex litigation", Baird analyst Eric Coldwell wrote in a note.

It was not immediately clear if the proposed global settlement would be accepted by the majority of the communities involved. But half the states and hundreds of local governments oppose it. "This should be a global settlement, but it's got to be fair and it's got to be now".

The judge overseeing Monday's trial said he would work out a new trial date for the remaining defendant, pharmacy chain operator Walgreens Boots Alliance.

In a statement, Walgreens noted in its defense that it distributed opioids only to its own pharmacies, something it says differentiates the company from others in the industry. It said it was diligent to prevent the diversion of controlled substances.


They accused the drug companies of creating a "public nuisance" which harmed health and safety by engaging in aggressive and deceptive marketing tactics by overstating the benefits of opioids and downplaying their risks. National distributors, meanwhile, failed to take action on suspicious orders, plaintiffs argue.

Federal data released as part of the litigation shows that 76 billion oxycodone and hydrocodone pills were shipped to U.S. pharmacies from 2006 to 2012, with shipments continuing to grow even after the U.S. Drug Enforcement Administration warned the drug industry about the increasing misuse of prescription opioids.

The trial was scheduled to pit two OH counties against the five companies that the local governments say helped drive a nationwide crisis.

By going to trial, it could have cost the drug companies more than $8 billion if Cuyahoga and Summit counties were awarded all the money they were seeking, according to The Washington Post. "People are dying now", he said.

In a statement, the three major distributors said the settlement funds should be used "in support of initiatives to combat the opioid epidemic, including treatment, rehabilitation, mental health and other important efforts".


Polster, has aggressively pushed for a settlement that "could do something meaningful to abate this crisis".

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