Deal averts first federal opioid trial
A key drugmaker and multiple distributors facing a historic opioid lawsuit reached a landmark settlement Monday with two Ohio counties suing to recoup damages and develop recovery programs for those highly addicted to the painkillers.
The tentative settlement came hours before opening statements were set to be delivered in the Cleveland case, viewed as a harbinger for legal claims filed by more than 2,700 local and state governments.
Lawyers stressed, however, that the deal involved only the two counties and was not a “global resolution” to the nationwide litigation.
McKesson Corp., Cardinal Health Inc., AmerisourceBergen Corp. and Israel-based drugmaker Teva Pharmaceutical Industries Ltd. will pay a total of $215 million under terms of the deal, said Hunter Shkolnik, who represents Cuyahoga County. Teva would contribute $20 million in cash and $25 million worth of Suboxone, used to treat opioid addiction.
“We are excited our client Cuyahoga County could set the real benchmark for local government settlements across the country,” Shkolnik said.
Distributor Henry Schein announced it had settled for $1.25 million, leaving only drug store chain Walgreens in the case. A possible trial involving the drugstore chain was put on hold.
Federal Judge Dan Polster had encouraged a settlement, which would provide affected communities the funds to combat opioid addiction much sooner than the lengthy process of going through a trial and the appeals that could follow.
“The proposed settlement will make significant progress to abate the epidemic by providing resources for and applying funds directly to necessary opioid-recovery programs,” lawyers representing local governments nationwide in the opioid cases said in a statement. Attempts at a broader settlement broke down last week. An offer of $48 billion in cash, treatment drugs and services was rejected as lawyers for the the cities and counties involved clashed with states attorneys general over the distribution of the settlement.
OxyContin maker Purdue Pharma reached a tentative national settlement last month worth up to $12 billion. On Sunday, a committee guiding Purdue Pharma’s bankruptcy had suggested drugmakers, distributors and pharmacy chains such as Walgreens use Purdue’s bankruptcy proceedings to settle lawsuits.
The Ohio case had been set to be the first federal trial related to an opioid crisis that has claimed an estimated 400,000 American lives over two decades. Cuyahoga and Summit counties sued Teva, the distributors and Walgreens claiming their practices contributed to the devastating opioid epidemic.
Despite the settlement, the defendants deny wrongdoing. All have consistently maintained that the drugs survived intense Food and Drug Administration scrutiny and carry warning labels explaining the risk of addiction.
Walgreens, still in settlement talks, argues that it closely controlled dispensing of the drugs.