The Journal Gazette
 
 
Wednesday, July 21, 2021 1:00 am

US opioid suits on verge of settlements

Associated Press

The yearslong effort by state and local governments in the U.S. to force the pharmaceutical industry to help pay to fix a nationwide opioid addiction and overdose crisis took a major step forward Tuesday when lawyers for local governments announced they were on the verge of a $26 billion settlement with the nation's three biggest drug distribution companies and the drugmaker Johnson & Johnson.

Under the deal, Johnson & Johnson would not produce any opioids for at least a decade. And AmerisourceBergen, Cardinal Health and McKesson share prescribing information under a new system intended to stop the avalanches of pills that arrived in some regions about a decade ago.

Lawyers for local governments said full details could be shared within days. That would not be the end of the deal, though; each state would have 30 days to decide whether to join. And local governments will have five months after that to decide. If governments don't opt in, the settlement total would go down.

“This is a nationwide crisis and it could have been and should have been addressed perhaps by other branches of government,” Paul Geller, one of the lead lawyers representing local governments across the U.S., said in a conference call with reporters Tuesday. “But this really is an example of the use of litigation for fixing a national problem.”

If approved, the settlement will likely be the biggest of many settlements to opioid litigation. While it means billions for lawyers who worked the cases, it is expected to bring more than $23 billion to abatement and mitigation efforts to help get treatment for people who are addicted along with other programs to address the crisis. The money would come in 18 annual payments, with the biggest amounts in the next several years.

The deal echoes one the companies have been pushing for two years.

Johnson & Johnson reiterated in a statement that it's prepared to contribute up to $5 billion to the national settlement.

“There continues to be progress toward finalizing this agreement and we remain committed to providing certainty for involved parties and critical assistance for families and communities in need,” the company said. “The settlement is not an admission of liability or wrongdoing, and the Company will continue to defend against any litigation that the final agreement does not resolve.”

Cardinal Health declined to comment early Tuesday, and the other distribution companies did not respond to requests for comment.

An Associated Press tally finds there have been at least $40 billion in completed or proposed settlements, penalties and fines between governments and the toll of opioids since 2007, not including one between the federal government and OxyContin maker Purdue Pharma in which most of the $8.3 billion would be waived. Purdue is trying to reach a deal through bankruptcy court that could be worth $10 billion over time; a hearing on that plan is scheduled for August.

Other deals are possible. While a growing number of companies in the industry have struck deals, some manufacturers have not – and no pharmacy companies have struck nationwide settlements.

But the total amount in the settlements is far below estimates of the financial costs of the epidemic. The Society of Actuaries found that the cost of the crisis in the U.S. was $630 billion from 2015 through 2018, with most of the costs borne by the private sector. And the White House Council of Economic Advisers, when considering the economic impact of people who fatally overdosed, put the one-year cost at about $500 billion nationally.

Unlike with the tobacco settlements reached in the 1990s, governments have agreed to spend money they bring in from opioid-related settlements to deal with the opioid crisis.


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