$260 million deal averts 1st federal trial on opioid crisis

The nation’s three biggest drug distributors and a major drugmaker reached an 11thhour, $260 million settlement over the toll of the opioids in two Ohio counties, averting what would have been the first federal trial over the crisis.

The settlement was announced just hours before the trial was scheduled to start, with a jury selected last week.

The trial involved only two counties — Cleveland’s Cuyahoga County and Akron’s Summit County — but was seen as an important test case that could gauge the strength of the opposing sides’ arguments and prod them toward a nationwide settlement.

U.S. District Judge Dan

Polster, who is overseeing the mountain of lawsuits, has long pushed for a coast-tocoast settlement that would provide money for treatment and other expenses associated with the crisis and force the industry to change its ways.

The plaintiffs have accused the industry of aggressively marketing opioids while downplaying the risks of addiction and turning a blind eye toward suspiciously large shipments of the drugs. The industry has denied wrongdoing.

Rome and Floyd County are part of the case before Polster. He certified in September a negotiation class that would be part of a potential settlement and gave cities and counties through Nov. 22 to opt out.

Both the Rome City Commission and County Commission have signaled their interest in staying the course. City Attorney Andy Davis said earlier he is keeping daily tabs on the situation he describes as “extremely fluid.”

The agreement announced Monday calls for the distributors Amerisourcebergen, Cardinal Health and Mckesson to pay a combined $215 million, said Hunter Shkolnik, a lawyer for Cuyahoga County.

Israeli-based drugmaker Teva would contribute $20 million in cash and $25 million worth of Suboxone, a drug used to treat opioid addiction.

“People can’t lose sight of the fact that the counties got a very good deal for themselves, but we also set an important national benchmark for the others,” Shkolnik said.

The deal contains no admission of wrongdoing by the defendants, said Joe Rice, a lead plaintiffs’ lawyer.

But it could turn up the pressure on all sides to work out a nationwide settlement, because every partial settlement reached reduces the amount of money the companies have available to pay other plaintiffs.

Separately, the small distributor Henry Schein also announced Monday that it is settling with Summit County for $1.25 million. The company was not named in Cuyahoga’s lawsuit.

After the new settlements and previous ones with other drugmakers, the only defendant left in the trial that had been scheduled for Monday is the pharmacy chain Walgreens. The new plan is for Walgreens and other pharmacies to go to trial within six months.

Monday’s settlement removes the risks and uncertainties involved in a trial for both sides: The counties immediately lock in money they can use to deal with the crisis, and the drug companies avoid a possible finding of wrongdoing and a huge jury verdict.

The settlement also means that the evidence prepared for the trial won’t be fully aired.

In a statement, the three big distributors said they dispute the counties’ accusations but agreed that the settlement could help clear the way for a bigger one.

Oxycontin maker Purdue Pharma, often cast as the biggest villain in the crisis, reached a tentative settlement last month that could be worth up to $12 billion. But half the states and hundreds of local governments oppose it. It remains to be seen whether the settlement will receive the approvals it needs.

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.

“We never sold opioid medications to pain clinics, internet pharmacies or the ‘pill mills’ that fueled the national opioid crisis,” the company said.