AG: State reaches $4.25B preliminary agreement with opioid manufacturer

HARRISBURG — Pennsylvania Attorney General Josh Shapiro announced this week that his office has reached an agreement in principle on key financial terms with opioid manufacturer Teva for alleged deceptive marketing and failing to comply with suspicious ordering monitoring requirements.

The agreement will provide up to $4.25 billion to states and local governments. Details of the settlement are currently under negotiation.

“My office continues to hold companies responsible for fueling the opioid crisis,” said Shapiro. “Teva downplayed the risk of addiction when it marketed its opioids and overstated potential benefits, deceiving doctors and patients. Today’s settlement ensures Teva will pay for its irresponsible actions, with funds going directly to communities in Pennsylvania most impacted by the opioid epidemic.”

Teva manufactures the drugs Actiq and Fentora, which are branded fentanyl products for cancer patients who have developed a tolerance to other opioids. Teva also manufactures a number of generic opioids, including oxycodone. A multistate coalition alleges that Teva promoted potent, rapid-onset fentanyl products for use by non cancer patients in addition to deceptively marketing their opioids by downplaying the risk of addiction. Teva is also alleged to have overstated the benefits of its opioids and encouraged the idea that signs of addiction are actually “pseudo addiction” and should be treated by prescribing more opioids. Teva, along with its distributor, Anda, are also accused of failing to comply with suspicious ordering monitoring requirements.

The aagreement is the result of a multistate investigation, led by Shapiro, into six manufacturers and three distributors for their roles in the opioid epidemic. That investigation previously led to a $26 billion agreement with Amerisource Bergen, Cardinal Health, McKesson, and Johnson & Johnson.

Parties have agreed to the following:

• Teva will pay a maximum of $4.25 billion in cash over 13 years. This

figure includes money that Teva has already agreed to pay under separate settlements with individual States, funds for participating States and subdivisions, and the $240 million of cash in lieu of product described below.

• As part of the financial term, Teva will provide up to $1.2 billion in generic naloxone (valued at Wholesale Acquisition Cost, or WAC) over a 10-year period or $240 million of cash in lieu of product, at each State’s election.

• The settlement will build on the existing framework that states and subdivisions have created through other recent opioid settlements.

A final settlement remains contingent on agreement on critical business practice changes and transparency requirements.

Negotiations were led by Pennsylvania with California, Illinois, Iowa, Massachusetts, New York, North Carolina, Tennessee, Texas, Vermont, Virginia and Wisconsin.