NEW YORK – Prosecutors from several United States (US) states yesterday unveiled a sweeping proposed settlement under which four pharmaceutical companies accused of fuelling the opioid epidemic in the country will pay up to US$26 billion (RM109 billion) to resolve thousands of claims in federal and state courts.
Under the proposed agreement, three drug distributors – McKesson, Cardinal Health and Amerisource Bergen – along with drug maker Johnson & Johnson, will pay to resolve some 4,000 claims, and finance prevention and treatment programmes, said New York Attorney General Letitia James.
The proposed settlement is the largest unveiled in the multiyear legal effort to hold the industry accountable for the opioids crisis, which has caused more than 500,000 deaths in the US in the last 20 years.
“The numerous companies that manufactured and distributed opioids across the nation did so without regard to life or even the national crisis they were helping to fuel,” said James in a statement.
“Today, we are holding these companies accountable and infusing tens of billions of dollars into communities across the nation.”
James told reporters that the settlement covers civil cases, but declined to comment on whether criminal charges are still possible.
“People are dying”
At least two states, Washington and West Virginia, criticised the agreement and vowed to continue litigation.
Washington Attorney-General Bob Ferguson said the proposed US$527.5 million payoff to his state over 18 years is “not a transformative amount of money, and is not sufficient to address the opioid crisis’ devastation”.
West Virginia Attorney-General Patrick Morrisey, who settled previously with the three distributors but still has a case open against J&J, said the agreement “short-changes” smaller states by apportioning funds on the basis of population rather than “the intensity of the opioid crisis”.
Prosecutors supporting the agreement said they expect most states will welcome a chance for immediate funds.
“We want to get these monies in our communities as quickly as possible, and to the maximum amount possible because people are dying, and we want to save lives,” said North Carolina Attorney-General Josh Stein.
He said he expects more than 40 states will support the settlement.
Besides New York and North Carolina, the states of Connecticut, Delaware, Louisiana, Pennsylvania and Tennessee have already signed the deal.
National clearing house
The settlement does not address legal cases against Teva and Allergan, nor does it address the role of drugstore chains, such as Walgreens and CVS, that have also been sued.
Under the agreement, J&J agreed to pay up to US$5 billion over nine years and stop selling opioids nationwide, said James.
The three distributors will pay up to US$21 billion over 18 years, and agreed to set up a centralised clearing house to help state officials track drug shipments and better guard against suspicious orders.
The exact amount will be determined by overall participation of state and local governments, according to the statement.
The three distributors described a process where first the states, and then localities, will have chance to support the agreement.
At each stage, each of the three companies will “independently determine” whether there is enough support to proceed.
“While the companies strongly dispute the allegations made in these suits, they believe the proposed settlement agreement and process it establishes... are important steps toward achieving broad resolution of governmental opioid claims and delivering meaningful relief to communities across the US,” said the companies.
McKesson could pay up to US$7.9 billion, while the other two companies could be each responsible for up to US$6.4 billion.
J&J general counsel Michael Ullmann said the proposed settlement “will directly support state and local efforts to make meaningful progress in addressing the opioid crisis in the US”.
Shares of all four companies gained, as investors greeted the chance of removing uncertainty surrounding the price of liability.
Shares of J&J rose 0.6% to US$169.49, McKesson gained 1.6% to US$197.54, AmerisourceBergern climbed 1.5% to US$118.22 and Cardinal health advanced 1.6% to US$58.60. – AFP, July 22, 2021
