The three largest US drug distribution companies and pharmaceutical company Johnson & Johnson are on the brink of a $ 26 billion settlement covering thousands of lawsuits over the US opioid crisis, they said Tuesday. Two people with knowledge of the plans told the Associated Press.
As a precursor to the larger settlement, distribution companies AmerisourceBergen, Cardinal Health and McKesson agreed mid-trial to pay up to $ 1.1 billion to settle claims by New York State and two of its largest counties about their role in the epidemic of opioids, the state said the attorney general.
That trial is expected to continue, but the settlement leaves only three drug makers as defendants.
The deal with New York Attorney General Letitia James and Nassau and Suffolk counties on Long Island came three weeks after the first jury trial in which the companies were accused of profiting from a flood of addictive painkillers that devastated communities.
“While no amount of money will ever make up for the millions of addictions, the hundreds of thousands of deaths, or the countless communities decimated by opioids, this money will be vital to preventing any future devastation,” said James.
Hunter Shkolnik, a Nassau County attorney, said that unlike the proposed national agreement, the New York agreement “does not depend on the rest of the country or other states joining in.”
In a joint statement, the distributors called the New York agreement “an important step toward finalizing a comprehensive agreement with states, counties and political subdivisions.”
Johnson & Johnson settled with New York last month, just before the trial began. He reiterated that he is willing to contribute up to $ 5 billion to the national agreement.
“It continues to move toward finalizing this agreement and we remain committed to providing stakeholder assurance and critical assistance to families and communities in need,” the company said.
“The agreement is not an admission of responsibility or wrongdoing, and the company will continue to defend itself against any litigation that the final agreement does not resolve.”
Distribution companies face thousands of similar legal claims from state and local governments across the country and have long been trying to resolve them all. The New York agreement would become part of a national agreement if one can be reached this year, according to one of the sources.
State and local governments say distribution companies did not have adequate controls to flag or stop shipments to pharmacies that were receiving huge stocks of powerful and addictive prescription painkillers. The companies have maintained that they were fulfilling orders for legal drugs placed by doctors, so they should not bear the blame for the nation’s addiction and overdose crisis.
An AP analysis of federal distribution data found that enough prescription opioids were shipped in 2012 for every person in the US to have a 20-day supply.
Opioids, including prescription drugs and illegal ones like heroin and illicitly produced fentanyl, have been linked to more than 500,000 deaths in the US since 2000.
Under the New York agreement, the three companies would provide more than $ 1 billion to reduce the epidemic in the state. The money would be delivered in 18 annual payments, with the first arriving this year.
The companies would also establish a national clearinghouse for data on opioid distribution, and the data would be monitored by an independent body. Johnson & Johnson would also agree not to produce opioids for the next 10 years.
Including the New York case, there are currently three lawsuits in the US of claims by government entities that companies should be held responsible for the opioid crisis. One in California focuses solely on drug makers, and another that is scheduled to wrap up this month in West Virginia targets only distributors. That could end if an agreement is reached.
Other cases are queued to begin. The only one of its kind to reach a verdict so far was two years ago in Oklahoma. There, a judge ordered Johnson & Johnson, the only company that did not reach an agreement before that trial, to pay $ 465 million. The company appeals the sentence.
The New York case is the largest ever to go to trial, and the first in which a jury decides the case rather than just a judge.
Johnson & Johnson settled for $ 230 million just before the case began. The remaining defendants are Teva Pharmaceutical Industries, Endo International and AbbVie.
With so many cases nearing trial, there has been a flood of proposed or made settlements on opioids. OxyContin’s maker, Purdue Pharma, filed for bankruptcy as part of its effort to resolve the cases. He proposes a reorganization that would use all future earnings to fight the epidemic as part of a deal that the company values at around $ 10 billion over time. That plan will face some opposition at a confirmation hearing in the US Bankruptcy Court next month.
George is Digismak’s reported cum editor with 13 years of experience in Journalism