Oct 22, 2019

The opioids legal battles rage on

Illustration: Lazaro Gamio/Axios

The federal opioids litigation took a step closer to resolution yesterday when major drug companies settled with 2 Ohio counties just before a trial was scheduled to begin.

Yes, but: States, municipalities and the companies being sued are still hashing out a global resolution to the thousands of lawsuits pending across the country.

Between the lines: "Monday's settlement, lawyers involved say, can't be directly extrapolated into what a larger deal might look like, since the pressure of an imminent trial often leads to larger payouts," the Wall Street Journal's Sara Randazzo reports.

Driving the news: Drug distributors McKesson, Cardinal Health, and AmerisourceBergen — along with Teva Pharmaceutical Industries — announced a $260 million settlement yesterday with the 2 counties.

Some state attorneys general announced yesterday afternoon that they had reached a $48 billion settlement "agreement in principle" with the distributors, Teva and Johnson & Johnson, and were hopeful that other states will join the agreement.

  • As Axios' Bob Herman points out, the $48 billion settlement is tentative and does not yet include a host of other states, counties and Native American tribes. It also does not include Purdue Pharma, which is working separately through its bankruptcy process, nor does it include other defendants.
  • And in a bad omen for its future, the lawyers representing city and county governments panned the proposal: "This appears to be the same proposal that 17 municipalities rejected on Friday and we don't see that changing," they said in a statement.

The bottom line: Opioid companies have avoided trials that would have pried open sensitive documents about their roles in the painkiller crisis. But the settlement talks are still far from over.

Go deeper

Teva's stock shines after agreeing to opioid settlements

Data: Investing.com; Chart: Axios Visuals

Three of the four defendants agreeing to pay $260 million to settle opioid litigation with two Ohio counties have seen their stock prices plummet, as the settlement leaves 2,700 more local governments still suing over the distributors' roles in the addiction crisis.

Why it matters: The deal could serve as a template that would put the companies on the hook for $47 billion in damages to all 2,700 counties serving as plaintiffs in the lawsuits, depending on what happens in individual representative "bellwether trials" that will shape negotiations.

Go deeperArrowOct 22, 2019

Cardinal Health sets aside $5.6 billion for opioid lawsuits

Photo: Igor Golovniov/SOPA Images/LightRocket via Getty Images

Drug distributor Cardinal Health registered a $5.6 billion pre-tax charge in the third quarter, saying the company "agreed in principle to a global settlement" with states, cities and others to pay that amount over 18 years to resolve the opioid cases.

Why it matters: Cardinal is the first company to set aside billions of dollars in preparation for any national opioids settlement, even though a definitive settlement agreement has not been finalized.

We're all paying for the opioid epidemic

Photo: John Moore/Getty Images

The ongoing opioid crisis cost $696 billion in 2018 and more than $2.5 trillion between 2015 and 2018, according to a new estimate by the White House Council of Economic Advisers.

Why it matters: Much of this cost is attributable to lives lost to opioids, but a good amount of it is borne by state and federal governments — and thus taxpayers. Meanwhile, opioid litigation settlement talks are homing in on payouts nowhere near this amount.

Go deeperArrowOct 29, 2019