USA TODAY International Edition
Opioid deal may set path ahead
Landmark settlement is for two Ohio counties
A key drugmaker and multiple distributors facing a historic opioid lawsuit reached a landmark settlement Monday with two Ohio counties suing to recoup damages from and develop recovery programs for the highly addictive 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.
But lawyers stressed 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 in
Claims have been filed by more than 2,700 local and state entities.
volving the chain was put on hold.
Federal Judge Dan Polster had encouraged a settlement, which would provide communities the money to combat opioid addiction much sooner than the lengthy process of 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 said in a statement.
Later Monday, some of the state attorneys general who have been negotiating a global deal with the drug companies said the framework of such an deal is in place, and they expressed optimism the lawyers representing cities and counties would come on board.
The proposal mirrors the $ 48 billion package the local governments rejected Friday, largely over concerns over how the payout would be distributed and who would make those decisions.
Under the terms of the deal, the drug companies would pay $ 22.25 billion in cash, $ 18 billion of it over 18 years coming from the three distributors and $ 4 billion from Johnson & Johnson over the initial two to three years. Teva would pay $ 250 million over 10 years.
Teva also would contribute the lion’s share of the $ 26 billion non- cash component, with $ 23 billion in Suboxone treatment. The remaining $ 3 billion, from the distributors, would be used for distribution costs and setting up a clearinghouse.
North Carolina Attorney General Josh Stein said getting the lawsuit from the Ohio counties out of the way was a crucial step toward a bigger agreement because they wanted their own deal.
“There was nothing we could do in a national settlement that would satisfy those two counties,” Stein said. “Now that litigation has been resolved and we can broaden the ( scope) and figure out how can we can solve this.”
The next opioid trial is set for January in West Virginia. Carl Tobias, a product liability expert and law professor at the University of Richmond in Virginia, told USA TODAY that trial could help provide lawyers and litigants a sense of what verdicts in such cases could be worth.
“Plaintiffs are having difficulty agreeing on the best strategy going forward and how to protect their own interests,” Tobias said. “There are many moving parts – this is very complex.”
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. But Paul Hanly, a lead lawyer for local governments in the lawsuits, had called that mass settlement idea “most unlikely.”
The Ohio case had been set to be the first federal trial related to an opioid epidemic 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 epidemic.
Despite the settlement, the defendants deny wrongdoing. All have 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, says it closely controlled dispensing of the drugs.
“We never sold opioid medications to pain clinics, Internet pharmacies or the ‘ pill mills’ that fueled the national opioid crisis,” the company said in a statement.