More Money Demanded in Opioid Settlement Talks
October 18 2019 - 07:57PM
Dow Jones News
By Sara Randazzo
CLEVELAND -- Plaintiffs lawyers for cities and counties are
demanding more money from major drug distributors, holding up a
wide-ranging settlement of opioid litigation after hours of
negotiations failed to result in a deal.
Top health-care executives and legions of lawyers descended on
the federal courthouse here Friday for settlement talks under the
guidance of U.S. District Judge Dan Polster, who called all sides
to his courtroom in a last-chance attempt to strike a settlement
ahead of a Monday trial.
Three drug distributors, AmerisourceBergen Corp., Cardinal
Health Inc. and McKesson Corp., have offered to pay $18 billion
over 18 years to resolve lawsuits filed by state and local
governments seeking to blame them for helping fuel the opioid
crisis, The Wall Street Journal has reported, citing people
familiar with the discussions.
That amount isn't enough for cities and counties that have cases
in front of Judge Polster, Paul Hanly, a lead lawyer for the
municipalities, said outside of the judge's courtroom Friday. Mr.
Hanly said his group is pushing for more money to be paid out over
a shorter time frame, but state attorneys general are generally in
agreement about the deal.
Mr. Hanly said they are prepared to go to trial Monday. "We
expect the jury and the world to see the extent of wrongdoing by
these defendants," he said. "And we will try the case for as long
as is necessary."
Paul Farrell, a West Virginia attorney who is also leading the
local government cases, said he was concerned that distributors
have proposed West Virginia communities be cut out of the deal,
because the state's attorney general has collectively reached $73
million in settlements with the companies.
The governments allege drugmakers aggressively marketed -- and
played down the addictive risks of -- their prescription
painkillers, and that drug distributors didn't do enough to stop
suspicious orders that flooded into communities. The companies have
denied the allegations.
The settlement talks are an attempt to resolve over 2,000
lawsuits against the companies.
The chief executives of AmerisourceBergen, Cardinal and McKesson
came to Cleveland on Friday for the talks, as well as corporate
representatives from drugmaker Teva Pharmaceutical Industries Ltd.,
Walgreens Boots Alliance Inc. and a smaller distributor, Henry
Schein Inc.
Those six companies are set to be defendants in a landmark trial
starting Monday in front of Judge Polster. They'll face off against
two Ohio counties whose cases have been selected to serve as a
bellwether that will help guide how to resolve the rest of the
litigation.
Teva, a generic drugmaker based in Israel, has proposed donating
billions of dollars of drugs and a few hundred million in cash,
according to a person involved in the negotiations. Mr. Hanly said
that talks with Teva continue, and that they didn't have any
discussions Friday with Walgreens.
Representatives for Teva, Walgreens and Cardinal declined to
comment Friday evening. McKesson and AmerisourceBergen didn't
respond to requests for comment.
After gathering everyone into his courtroom Friday morning,
Judge Polster separated the parties into their own rooms and
shuttled between them for at least seven hours. Lawyers slipped in
and out, retrieving coffee and diet soda and checking in with other
camps.
In one corner were Mr. Hanly and other private plaintiffs'
lawyers representing cities and counties, who are driving the case
going to trial Monday.
In another camp were the attorneys general from North Carolina,
Tennessee, Texas and Pennsylvania, a bipartisan group leading talks
on behalf of the states.
Attorneys are discussing the creation of a three-tiered system
to guide how any settlement money is spent, according to a person
involved in the negotiations. The largest tier would go toward
programs aimed at abating the opioid crisis, with a smaller amount
going directly to states and a third bloc of money to cities and
counties.
Some attorneys remained in the courthouse into the evening
hours.
Pharmaceutical and consumer-products company Johnson &
Johnson is also engaged in talks to broadly settle the opioid
litigation but wasn't present in Cleveland on Friday. The company
already reached a $20.4 million settlement with the two Ohio
counties to avoid the trial.
Write to Sara Randazzo at sara.randazzo@wsj.com
(END) Dow Jones Newswires
October 18, 2019 19:42 ET (23:42 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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