Drug companies in $400 million US opioid settlement, just hours before federal trial

by on October 22, 2019

The nation’s three biggest drug distributors and a major drugmaker reached an 11th-hour, $400 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.

Across the country, the drug industry is facing more than 2600 lawsuits brought by state and local governments seeking to hold it accountable for the crisis that has been linked to more than 400,000 deaths in the US over the past two decades.

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A federal judge in Ohio has been pushing the parties toward a settlement of all the lawsuits for nearly two years.

The agreement calls for the distributors AmerisourceBergen, Cardinal Health and McKesson to pay a combined $336 million, said Hunter Shkolnik, a lawyer for Cuyahoga County.

Israeli-based drugmaker Teva would contribute $31 million in cash and $39 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.

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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 that it is settling with Summit County for $2 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 is the pharmacy chain Walgreens.

The new plan is for Walgreens and other pharmacies to go to trial within six months.

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The 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.

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