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Companies reach $260 million deal to settle opioids lawsuit

UPDATED: Mon., Oct. 21, 2019

Mark Lanier, right, an attorney for the plaintiffs, enters the U.S. Federal courthouse, Monday, Oct. 21, 2019, in Cleveland. The nation's three dominant drug distributors and a big drugmaker have reached a tentative deal to settle a lawsuit related to the opioid crisis just as the first federal trial over the crisis was due to begin Monday, according to a lead lawyer for the local governments suing the drug industry. (Tony Dejak / associated press)
Mark Lanier, right, an attorney for the plaintiffs, enters the U.S. Federal courthouse, Monday, Oct. 21, 2019, in Cleveland. The nation's three dominant drug distributors and a big drugmaker have reached a tentative deal to settle a lawsuit related to the opioid crisis just as the first federal trial over the crisis was due to begin Monday, according to a lead lawyer for the local governments suing the drug industry. (Tony Dejak / associated press)
By Julie Carr Smyth and Geoff Mulvihill Associated Press

CLEVELAND – The nation’s three dominant drug distributors and a big drugmaker have reached a $260 million deal to settle a lawsuit related to the opioid crisis just as the first federal trial over the crisis was due to begin Monday.

The settlement means the closely watched trial will not move forward now, but it does not resolve more than 2,600 other lawsuits across the country seeking to hold the drug industry accountable for an opioid crisis that has been linked to more than 400,000 deaths in the U.S. since 2000.

The settlement ends only the suits brought by the Ohio counties of Cuyahoga and Summit.

Hunter Shkolnik, a lawyer for Cuyahoga County, said the agreement calls for the distributors AmerisourceBergen, Cardinal Health and McKesson to pay a combined $215 million. Drugmaker Teva would contribute $20 million in cash and $20 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,” Shkolnick said.

Separately, the small distributor Henry Schein also announced Monday that it’s settling with Summit County for $1.25 million. The company was not named in Cuyahoga’s lawsuit.

After the new settlements and previous ones with five other drugmakers, the only defendant left in the trial that had been scheduled for Monday is the pharmacy chain Walgreens. The new plan is for Walgreens and other pharmacies to go to trial within six months if they don’t reach settlements first.

Polster said the deal with Teva and the distributors was reached very early Monday morning.

The judge overseeing the federal litigation had long pushed for settlements that would not only provide for damages for the plaintiffs, but also change practices as a way to make a dent in the opioid crisis.

Parties say talks on a global settlement will continue.

Industry CEOs and attorneys general from four states met Friday in a daylong session in Cleveland where the offer in place was a deal worth potentially $48 billion in cash and drugs over time to settle cases nationally. The deal was not completed partly because of disagreements between state and local governments over how to allocate the settlement, which would have come from the three big distributors, Teva and Johnson & Johnson.

The epidemic has become more complicated in the past decade, with fatal overdose numbers rising largely because of illicit drugs such as heroin and fentanyl.

The settlement efforts until now have been mixed.

Four drugmakers reached deals only with the two Ohio counties – enough to get them out of the first trial, but leaving unresolved the claims from communities across the country.

OxyContin maker Purdue Pharma reached a tentative settlement last month that could be worth up to $12 billion over time. But half the states and hundreds of local governments oppose it. The company is now going through federal bankruptcy proceedings in White Plains, New York, creating the possibility that its settlement offer could be renegotiated.

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