US states will reach a $26 billion opioid settlement agreement with drug distributor Johnson & Johnson

© Reuters. File photo: Johnson & Johnson building on January 24, 2017 in Irvine, California, USA. REUTERS/Mike Blake

By Nate Raymond

(Reuters)-A person familiar with the matter said on Monday that the U.S. Attorney General is expected to announce a $26 billion settlement agreement this week to address the three major drug distributors and pharmaceutical company Johnson & Johnson (NYSE:) It has contributed to accusations that the country’s opioid epidemic is popular.

Distributor McKesson Corp (NYSE:), Cardinal Health Inc (NYSE:) and AmerisourceBergen (NYSE:) Corp will jointly pay US$21 billion, while Johnson & Johnson will pay US$5 billion. A source said that New York is expected to announce on Tuesday that distributors have agreed to reach a settlement of more than $1 billion with the state.

The final settlement price may fluctuate based on the number of states and political departments that agree or reject the transaction and file lawsuits on their own in order to obtain greater returns.

Two sources said that more than 40 states are expected to support national reconciliation. The source said that states will have 30 days to decide whether to join the global agreement, and then have more time to try to persuade their cities and counties to participate in the agreement.

McKesson previously stated that the three distributors will pay 21 billion U.S. dollars within 18 years, of which more than 90% will be used to remedy the opioid crisis, and the remaining approximately 2 billion U.S. dollars will be used to pay the plaintiff’s legal fees and expenses.

Some states have passed laws or reached agreements with their political departments to manage the distribution of settlement proceeds in the case of national settlements.

The financial terms are consistent with what the three distributors and Johnson & Johnson previously disclosed about the fees they expect to pay after long-term settlement negotiations.

Johnson & Johnson said in a statement: “We continue to make progress in finalizing the agreement, and we remain committed to providing certainty to all parties involved and providing critical assistance to families and communities in need.”

McKesson and Cardinal Health did not comment, and AmerisourceBergen said it would not comment on “rumors and speculation.” They have previously denied any wrongdoing.

According to the U.S. Centers for Disease Control and Prevention (CDC), from 1999 to 2019, nearly 500,000 people in the U.S. died from opioid overdose. During the COVID-19 pandemic, the opioid crisis seems to have worsened.

The US Centers for Disease Control and Prevention said last week that interim data showed that 2020 was a record year for drug overdose deaths, with 93,331 people, an increase of 29% over the same period last year. 74.7% or 69,710 people died of opioid overdose.

Distributors are accused of lax control, causing a large number of addictive painkillers to be diverted to illegal channels and disrupting communities, while Johnson & Johnson is accused of downplaying the risk of addiction.

Governments have stated that the funds will be used to fund addiction treatments, family support programs, education and other health measures in response to crises.

Other settlements are also working with opioid manufacturers Purdue Pharma and Malincrot (OTC:) Plc is currently seeking support through the bankruptcy court to obtain settlement support worth more than US$10 billion and US$1.6 billion, respectively.

The distributor has been conducting two trials across the country, one in New York and one in West Virginia. A person familiar with the matter said that they have now agreed to resolve the New York case.

The agreement reached with New York Attorney General Letitia James and the populous Long Island Nassau and Suffolk counties is the first three weeks after a jury trial accused the company of profiting from a large number of addictive painkillers that destroyed the community.

The conclusion of the case is expected to be debated in the West Virginia trial next week. The local community in West Virginia has opted out of the proposed national deal and sought an agreement on its own.

The New York trial will continue to target the three drugmakers accused of deceptively marketing painkillers-Endo International (NASDAQ:) Plc, Teva Pharmaceutical Industries (NYSE:) Ltd and AbbVie (NYSE code:) Allergan (NYSE code:) department.

Source link

Recommended For You

About the Author: Agnes Zang