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US states reveal $26 billion drug settlement with drug distributors, J&J – sources

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US state attorneys general are expected this week to announce a $26 billion settlement to settle allegations that three major drug distributors and drugmaker Johnson & Johnson helped promote driving the opioid epidemic across the country, people familiar with the matter said Monday.

Distributors McKesson Corp, Cardinal Health Inc and AmerisourceBergen Corp will pay a combined $21 billion, while Johnson & Johnson will pay $5 billion. New York will announce on Tuesday that distributors have agreed to a deal worth more than $1 billion with the state, a source said.

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The final settlement price list can fluctuate depending on how many states and political subdivisions agree to the settlement or reject the deal and pursue their own lawsuit in hopes of a larger sum.

More than 40 states are expected to support the settlement nationwide, two sources said. Countries will have 30 days to decide whether to join the global accord, after which there will be more time to convince their cities and counties to join, the sources said.

McKesson previously said that of the $21 billion the three distributors will pay over 18 years, more than 90% will be used to tackle the opioid crisis while the rest, about $2 billion, will used to pay the plaintiff’s attorney fees and expenses.

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Some states have passed legislation or reached agreements with their political subdivisions to govern how settlement money is distributed in the case of a nationwide settlement.

The financial terms are in line with prior disclosures by the three distributors and J&J of what they expect to pay following lengthy settlement negotiations.

“Progress is still being made in finalizing this agreement, and we remain committed to providing certainty to our stakeholders and vital support to families and communities,” J&J said in a statement. need help.

McKesson and Cardinal Health were not available for comment, while AmerisourceBergen said they did not comment on “rumors and speculation”. They have all previously denied wrongdoing.

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According to the US Centers for Disease Control and Prevention (CDC), nearly 500,000 people died from opioid overdoses in the United States between 1999 and 2019. The opioid crisis appears to have worsened during the pandemic. COVID-19 pandemic.

The CDC last week said interim data showed 2020 was a record year for drug overdose deaths with 93,331, up 29% from a year earlier. Opioids were implicated in 74.7%, or 69,710, of overdose deaths.

Distributors were accused of lax controls allowing large amounts of narcotic pain relievers to flow into illegal channels, devastating the community, while J&J was accused of downplaying the risk of addiction.

Governments say the money will be used to fund addiction treatment, family support programmes, education and other health initiatives to tackle the crisis.

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Other settlements are also being negotiated, with opioid makers Purdue Pharma and Mallinckrodt Plc currently working through bankruptcy courts to secure support for settlements worth more than $10 billion and $1 billion. $6.6 billion, respectively.

The distributors have undergone two nationwide trials in the litigation, one in New York and the other in West Virginia. They have now agreed to settle the case in New York, one person said briefly on the matter.

The settlement with New York Attorney General Letitia James and the populous Long Island counties of Nassau and Suffolk will come three weeks after the first trial of a grand jury that alleges the companies profited from a range of narcotic painkillers Addiction has devastated the community.

Closing arguments are scheduled to take place during a trial in West Virginia next week. Local communities in West Virginia have opted out of the proposed nationwide agreement to pursue an agreement of their own.

The New York trial will continue against three drugmakers accused of fraudulently marketing their pain relievers – Endo International Plc, Teva Pharmaceutical Industries Ltd and the Allergan unit of AbbVie Inc. (Reporting by Nate Raymond in Boston; Editing by Sandra Maler, Bill Berkot and Cynthia Osterman)

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https://financialpost.com/pmn/business-pmn/u-s-states-to-unveil-26-billion-opioid-settlement-with-drug-distributors-jj-sources-2 | US states reveal $26 billion drug settlement with drug distributors, J&J – sources

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